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Bond A is a discount bond with face value of $100 and maturity of 10 years. Bond B is a discount bond with face value

Bond A is a discount bond with face value of $100 and maturity of 10 years.

Bond B is a discount bond with face value of $100 and maturity of 2 years.

Suppose the yield to maturity is currently 4%.

Over the course of the year, prevailing yields are expected to change according to the table below:

Next year's yield Probability
3% 0.33
4% 0.34
5% 0.33

Calculate the expected return of bond A.

Calculate the standard deviation of returns for bond A

Calculate the standard deviation of returns forbond B

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