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1. You have a one-year zero-coupon bond that pays $100, which price today is $95.23? You have a two-year coupon bond with a principal value

1. You have a one-year zero-coupon bond that pays $100, which price today is $95.23? You have a two-year coupon bond with a principal value of $100 and coupons of 5%. The spot rate for 2 years, (r2) is 10%. What is the spot rate for 1 year?

2. What is the price of the coupon bond?

3. Set the equation to solve the yield to maturity. Only show what equation you would use to get that rate.

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