Bonds assuming a market rate on similar risk bonds

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Reference no: EM13804378

Value these bonds assuming a market rate on similar risk bonds is 7% and interest is paid annually.

Value these bonds assuming a market rate on similar risk bonds is 7% and interest is paid semi-annually.

Value these bonds assuming a market rate on similar risk bonds is 12% and interest is paid annually.

Assuming both bonds were issued at the same time, why would the Co. Y bond pay a higher coupon?

Reference no: EM13804378

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