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What is the annual yield on a bond priced

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Reference no: EM132986147

Question -

A) What is the Annual Yield on a bond priced at $863 with a par value of $1000 that pays a 6% quarterly coupon and has 10 years to maturity? Is the bond a premium or a discount or an at par bond? Explain.

B) Explain using the Term Structure of Interest Rates concept, what is Liquidity Premium Theory and how does it differ from Pure Expectations Theory.

Reference no: EM132986147

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