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2. (10 Marks) A 8-year bond with annual coupon payments has a face value of $100. It sells for $89 and has the coupon rate
2. (10 Marks) A 8-year bond with annual coupon payments has a face value of $100. It sells for $89 and has the coupon rate of X% = 3.5%. Compute the bonds yield to maturity and its modified duration. Briefly explain.
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