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Calculate the value of the option of a 2 years 5% putable bond knowing that: 1. The option can be exercised only after one year
Calculate the value of the option of a 2 years 5% putable bond knowing that: 1. The option can be exercised only after one year 2. The interest rate tree is given by: one year rate=4%; one year out rates rL=4.5%, rH=5.5% 3. The bond can be put at par
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