4. A two-year $1000 par zero-coupon bond is cur- rently priced at $819.00. A two-year $1000 annu-...

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4. A two-year $1000 par zero-coupon bond is cur- rently priced at $819.00. A two-year $1000 annu- ity is currently priced at $1712.52. If you want to invest $50,000 in one of the two securities, which is a better buy? Hint: Compute the yield of each security.

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Financial Markets and Institutions

ISBN: 978-0321280299

5th edition

Authors: Frederic S. Mishkin, Stanley G. Eakins

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