Question: A . Bond A sells at a discount ( its price is less than par ) , and its price is expected to increase over

.

Bond A sells at a discount

(

its price is less than par

),

and its price is expected to increase over the next year.

.

Bond A

s price is expected to decrease over the next year, Bond B

s price is expected to stay the same, and Bond C

s price is expected to increase over the next year.

.

Since the bonds have the same yields to maturity, they should all have the same price, and since interest rates are not expected to change, their prices should all remain at their current levels until the bonds mature.

.

Bond C sells at a premium

(

its price is greater than par

),

and its price is expected to increase over the next year

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