Question: answer with explanation You are faced with two bonds ABC and XYZ that are viewed by investors as having the same risk. If ABC has

answer with explanation answer with explanation You are faced with two bonds ABC and XYZ

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. XY has 10 years to maturity, pays coupon semi-annually and is traded at a discount. The coupon rate for XYZ bond should be: Equal to 10% o Lower than 10% o Could be higher or lower, there is not enough information to decide. 10 Higher than 10% o

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