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A two-year bond with par value $1,000 making annual coupon payments of $100 is priced at $1,000. What is the yield to maturity of the
A two-year bond with par value $1,000 making annual coupon payments of $100 is priced at $1,000. What is the yield to maturity of the bond? What will be the realized compound yield to maturity if the one-year interest rate next year turns out to be (i) 8%, (ii) 10%, (iii) 12%?
If you can, use excel to answer questions & provide excel spreadsheet used to solve questions (with formulas displayed)
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