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1 . As of today, you have money to make a down payment on a house which you expect to buy in two years. You

1. As of today, you have money to make a down payment on a house which you expect to buy in two years. You are considering different ways to invest this money. Due to the uncertainty, you do not want to invest in stocks. Your choices are the following:
2-year zero coupon corporate bond, rated AA from S&P
2-year interest paying coupon corporate bond, rated A from S&P
5-year Treasury bond, with semiannual coupons
90 Day Treasury Bill
2-year Corporate bond, single B rating from S&P, with semiannual coupons
Which bond will you invest in? What factors did you consider in deciding the bond to invest in?

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