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3. a. (10 pts) You have a two year bond that has a market yield of 10% and a coupon rate of 10%. What is

3. a. (10 pts) You have a two year bond that has a market yield of 10% and a coupon rate of 10%. What is the price of this bond?

b. (10 points) Now market rates drop to 8%, What is the price of this bond?

c. (10 pts) What is the current yield from part b?

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