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Question
A 10-year bond with a 9% annual coupon has a yield to maturity of 8%. Which of the following statements is CORRECT?a. The bond is selling below its par value.
b. The bond is selling at a discount.
c. If the yield to maturity remains constant, the bond's price one year from now will be lower than its current price.
d. The bond's current yield is greater than 9%.
e. If the yield to maturity remains constant, the bond's price one year from now will be higher than its current price.
Answer
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