A step-down bond has a face value of $100 and 2 years to maturity. The annual coupon rate for the immediate next two coupons is 6% p.a. and the annual coupon rate for the final two coupons is 3% p.a. Coupons are paid semi- annually. The following table shows some relevant spot rates. What is the fair price of the bond? Choose the closest answer. Spot rate Year 0.5 1 1.5 2 5% p.a. 5% p.a. 4.6% p.a. 4.5% p.a. O A. 100.04 B. 108.11 OC. 101.87 OD. 105.96