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What are the two steps that make up the market segmentation process?
Annual Coupon
Annual Coupon refers to the yearly interest payment made by a bond issuer to its bondholders, based on the bond's face value.
Premium
The amount by which the price of a financial instrument or commodity exceeds its intrinsic or face value, often related to insurance costs or bond prices.
Maturity Risk Premium
An additional return that investors demand for holding a bond that has a longer time until maturity, reflecting the increased risk over time.
Interest Rates
The cost incurred by a borrower, represented as a proportion of the principal, for accessing a lender's assets.
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