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Below is a list of prices for zero-coupon bonds of various maturities. Price of $1,000 Par Maturity (Years) Bond (Zero-Coupon) 2 3 $978.14 876.02 843.70
Below is a list of prices for zero-coupon bonds of various maturities. Price of $1,000 Par Maturity (Years) Bond (Zero-Coupon) 2 3 $978.14 876.02 843.70 a. A 4.6% coupon $1,000 par bond pays an annual coupon and will mature in 3 years, what should the yield to maturity on the bond be? (Round your answer to 2 decimal places.) Yield to maturity b. If at the end of the first year the yield curve flattens out at 6.5%, what will be the 1-year holding-period return on the coupon bond? (Round your answer to 2 decimal places.) Holding-period return
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