You are considering purchasing an A-rated 5yr, Municipal bond with a coupon of 3.52%. Market yields for A-rated Munis are 3.25%. If you are a rational investor, which of the following statements is true about the bonds price?

Multiple Choice

• You will pay more than face value for this bond.

• You will pay exactly face value for this bond.

• You will pay less than face value for this bond.

• This is impossible. There is no such thing as an A-rated Municipal bond.

• There is not enough information to decide.