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c) What is the fair price of Bond A: a 1-year discount bond with a face value of 900 if rates (yield to maturity) are

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c) What is the fair price of Bond A: a 1-year discount bond with a face value of 900 if rates (yield to maturity) are 5%? What is the yield to maturity of Bond B: a 1- year discount bond with face value of 850 that trades at 90% par? Bond prices do not only depend on where rates are - discuss other factors that influence bond prices. [10 MARKS]

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