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A 30-year, zero-coupon bond has been stripped from the new 30-year Treasury coupon bond. The 30 year zero curve yield to maturity is 4%. For

A 30-year, zero-coupon bond has been stripped from the new 30-year Treasury coupon bond. The 30 year zero curve yield to maturity is 4%. For a face value of $1000, what price will the zero coupon bond initially trade for? If the bond's yield to maturity drops to 3%, what will its price be five years later? If you purchased the bond when it was issued and sold it five years later, what would the rate of return on your investment be?

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