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Consider a zero - coupon bond due in exactly six months with a face value of 1 0 0 and currently selling for 9 8

Consider a zero

-

coupon bond due in exactly six months with a face value of

100

and currently selling for

98 .

Assume you buy now and hold the investment to maturity.

1 .

What is the simple quarterly compounded rate of interest per annum on this investment?

2 .

What is the continuously compounded rate of interest on this investment?

3 .

What is the EAR on this investmen

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