You are faced with two bonds ABC and XYZ that are viewed by investors as having the same risk. If ABC has a 10% coupon rate, 10 years to maturity, pays coupon semi-annually and is traded at par. XYZ has 10 years to maturity, pays coupon semi-annually and is traded at a discount. The coupon rate for XYZ bond should be:

		Could be higher or lower, there is not enough information to decide.
		Higher than 10%
		Equal to 10%
		Lower than 10%

How much should you be prepared to pay for a $1,000 10-year bond with an annual coupon of 6% and a yield to maturity of 7.5%?

		$411.84
		$985.00
		$897.04
		$1,000.00