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☐ A
Your budget is $1,100. Given the opportunity to invest in one of the three bonds listed below, which would you
purchase? Assume an interest rate of 7%.
Bond
Face Value
Annual Coupon Rate
Maturity Price
A $1,000
5.5%
10
$900
B $1,000
7.5%
8
$1,000
$1,000
8.5%
2
$1,000
A. Purchase Bond A
B. Purchase Bond B
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C. Purchase Bond C