Question: Consider these two 10-year bonds that are equivalent in all respects expect payment frequency: A B Coupon 8% 8% Method semi-annual annual Price $1,000 ?

Consider these two 10-year bonds that are equivalent in all respects expect payment frequency: A B Coupon 8% 8% Method semi-annual annual Price $1,000 ? YTM 8.00% ? If bond A is priced fairly and investors price bonds based upon effective annual yield, then which of the following statements is true? Bond B should trade at a discount to par Bond B should trade at par Bond B should trade at a premium to par

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