Question: Use the information below to answer question a to i Par value 1000 Coupon rate 10% of par, paid annually Maturity = 5 years YTM

Use the information below to answer question a to i

Par value 1000

Coupon rate 10% of par, paid annually

Maturity = 5 years

YTM = 8% at time 0

  1. Explain why if you hold the bond from time 0 to maturity, IRR of your investment will be 8% regardless of how YTM moves between year 0 and year 5.

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