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2. Consider a bond that promises to make coupon payments of $100 one year from now and $100 two years from now, and to repay
2. Consider a bond that promises to make coupon payments of $100 one year from now and $100 two years from now, and to repay the principal of $1000 three years from now. Suppose also that the market interest rate is 8 percent per year, and that no perceived risk is associated with the bond. a Compute the present value of this bond. b. Suppose the bond is being offered for $995. Would you buy the bond at that price? What do you expect to happen to the bond price in the very near future? If the price of the bond is equal to its computed present value from part a, what is the implied bond yield
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