Face value risk-free bond

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Reference no: EM131832010

Would you be surprised to find a 4 year, zero coupon $1000 face value 'risk-free, bond with a discount rate of 8% and a five year, risk-free,' 20% coupon, $1000 face value bond with a discount rate of 88? (Hint - Calculate their prices and their durations and see if the rates of return are consistent with their interest rate risk.)

Reference no: EM131832010

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