Question: 8. A firm issues a bond with a coupon rate of 5.00% when the market interest rate is 5.50% on bonds of comparable risk

8. A firm issues a bond with a coupon rate of 5.00%

8. A firm issues a bond with a coupon rate of 5.00% when the market interest rate is 5.50% on bonds of comparable risk and terms. One year later, the market interest rate increases to 6.00%. Based on this information, the effective interest rate is: A 5.00%. B 5.50%. (I+~)^-|. C 6.00%. EAR m

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