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  3. suppose for $1,000 you could buy a 10%, 10-year, a

Suppose for $1,000 you could buy a 10%, 10-year, annual payment bond or a 10%,...

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Accounting

Suppose for $1,000 you could buy a 10%, 10-year, annual payment bond or a 10%, 10-year, semiannual payment bond. They are equally risk. Which would you prefer? If $1,000 is the proper price for the semiannual bond, what is the equilibrium price for the annual payment bond?

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