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Assume the zero-coupon yields on default-free securities are as summarized in the following table: 4 years 47% 5 years 5.1% 3 years Maturity Zero-Coupon Yields
Assume the zero-coupon yields on default-free securities are as summarized in the following table: 4 years 47% 5 years 5.1% 3 years Maturity Zero-Coupon Yields 1year 35% 2 years 4.0% What is the price today of a two-year, default-free security with a face value of $1,000 and an annual coupon rate of 8%? Does this bond trade at a discount, at par, or at a premium? Note: Assume annual compounding What is the price today of a two-year default-free security with a face value of $1,000 and an annual coupon rate of 8% The price is $. (Round to the nearest cent.)
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