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2. Calculate the present value of a $1000 discount bond with five years to maturity if the yield to maturity is 6%. 3. A lottery

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2. Calculate the present value of a $1000 discount bond with five years to maturity if the yield to maturity is 6%. 3. A lottery claims its grand prize is $10 million, payable over five years at $2 million per year. If the first payment is made immediately, what is this grand prize really worth? Use an interest rate of 6%

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