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For revision purpose only - Advanced Financial Management Assume the following information is given: The one year spot rate is 4.5%. Two-year, annual coupon bonds
For revision purpose only - Advanced Financial Management
Assume the following information is given:
The one year spot rate is 4.5%.
Two-year, annual coupon bonds are selling at par and yield 6%.
One-year interest rate volatility is 10%.
Assume an interest rate for the "down" scenario: 7%
Use Binomial Tree to calculate the Bond Value
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