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Author Question: Fortunate Frames Inc. just issued 20-year, 6% coupon bonds at par. Lucky Lenses Inc. has 20-year ... (Read 16 times)

rmenurse

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on: Apr 25, 2021

Question 1

Everything else being equal, a ________ bond's price will ________ as the bond approaches maturity.
◦ premium; remain the same
◦ discount; decrease
◦ discount; increase
◦ discount; remain the same
◦ premium; increase

Question 2

Fortunate Frames Inc. just issued 20-year, 6% coupon bonds at par. Lucky Lenses Inc. has 20-year bonds outstanding that are viewed by investors as having the same risk as Fortunate's bonds. Lucky's bonds are selling at a discount. What does this indicate about the coupon rates on these two bonds?
◦ Lucky's coupon rate must be lower than Fortunate's coupon rate.
◦ They must have the same coupon rate.
◦ Fortunate's coupon rate must be lower than Lucky's coupon rate.
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Marked as best answer by rmenurse on Apr 25, 2021

mathjasmine

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Reply #1 on: Apr 25, 2021
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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rmenurse

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Reply 2 on: Apr 25, 2021
Great answer, keep it coming :)

nanny

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Reply 3 on: Yesterday
Gracias!

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