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Question
A Treasury bond has an 8% annual coupon and a 7.5% yield to maturity. Which of the following statements is CORRECT?a. The bond has a current yield greater than 8%.
b. The bond sells at a discount.
c. The bond's required rate of return is less than 7.5%.
d. If the yield to maturity remains constant, the price of the bond will decline over time.
e. The bond sells at a price below par.
Answer
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