The other bond has a coupon rate of 5 and a yield to


You are trying to price two bonds that have the same maturity and par value but different coupon rates. Both bonds mature in 8 years and at maturity both bonds return the par value of $1,000. One bond has a coupon rate of 3% and a yield to maturity of 3%. The other bond has a coupon rate of 5% and a yield to maturity of 3%. What is the absolute value of the difference between the prices of these two bonds?

a.$ 119.43

b.$ 140.39

c.$ 62.10

d.$ 0

e.$ 67.33

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Finance Basics: The other bond has a coupon rate of 5 and a yield to
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