Two bonds have par values of $1,000. One is a 5 %, 14 -year bond priced...

Two bonds have par values of $1,000. One is a 5 %, 14 -year bond priced to yield 8.5 %. The other is a(n) 9 %, 21 -year bond priced to yield 6.5 %. Which of these two has the lower price? (Assume annual compounding in both cases.)

The price, PV , of the 5 %, 14 -year bond is $. (Round to the nearest cent.)

The price, PV, of the 9 %, 21 -year bond is $. (Round to the nearest cent.)

Which of these two has the lower price? (Select the best answer below.)

The 5%, 14-year bond has lower price of $719.65

The 9%, 21-year bond has lower price of $719.65

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jeff jeffy answered 1 year ago

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