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3. You have the following information: Financial instrument maturity Value 1 year 8% 2 years 11% 3 years 12% 4 years 13% 5 years 15%

3. You have the following information:
Financial instrument maturity Value
1 year 8%
2 years 11%
3 years 12%
4 years 13%
5 years 15%
coupon rate/yield
a) Draw the yield curve
b) Estimate the annual interest rate.

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