A firm issues ten-year bonds with a coupon rate of 6.8%, paid semiannually. The credit spread for this firm's ten-year debt is 0.8%. New ten-year Treasury notes are being issued at par with a coupon rate of 3.7%. What should the price of the firm's outstanding ten-year bonds be per $100 of face value? OA. $165.70 OB. $94.69 OC. $118.36 OD. $142.03

Essentials Of Investments
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ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
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Chapter1: Investments: Background And Issues
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Ef 492.

A firm issues ten-year bonds with a coupon rate of 6.8%, paid semiannually. The credit spread for this firm's ten-year
debt is 0.8%. New ten-year Treasury notes are being issued at par with a coupon rate of 3.7%. What should the price of
the firm's outstanding ten-year bonds be per $100 of face value?
OA. $165.70
OB. $94.69
OC. $118.36
OD. $142.03
REED
Transcribed Image Text:A firm issues ten-year bonds with a coupon rate of 6.8%, paid semiannually. The credit spread for this firm's ten-year debt is 0.8%. New ten-year Treasury notes are being issued at par with a coupon rate of 3.7%. What should the price of the firm's outstanding ten-year bonds be per $100 of face value? OA. $165.70 OB. $94.69 OC. $118.36 OD. $142.03 REED
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