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Consider a three-year bond with face value F = 1000 and a coupon rate c = 10% paid semi- annually. Suppose the bond is traded

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Consider a three-year bond with face value F = 1000 and a coupon rate c = 10% paid semi- annually. Suppose the bond is traded at a price B = 1025. Answer the following questions: a. (1) Compute the rate of return on this bond if an investor bought it today and decided to hold it till maturity. Keep your answer to four decimal places. b. (0.5] Define what it means by the yield to maturity. c. (1.5) Compute the yield to maturity on this bond. Keep your answer to four decimal places in all calculations. d. 12) Suppose you bought that bond from this investor at the end of year 2. How much would you pay for this bond if the market interest is 4%? Keep your answer to four decimal places in all steps

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