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Below is a list of prices for zero-coupon bonds of various maturities. Required: a. A 6.5% coupon $1,000 par bond pays an annual coupon and
Below is a list of prices for zero-coupon bonds of various maturities. Required: a. A 6.5% 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? b. If at the end of the first year the yield curve flattens out at 8.0%, what will be the 1-year holding-period return on the coupon bond? Complete this question by entering your answers in the tabs below. A 6.5% 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? Note: Round your answer to 2 decimal places
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