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Matrix Pricing: Compute the price of an illiquid 4-year 5% annual coupon bond, given 2 similar credit quality bonds have the following characteristics. A) A
Matrix Pricing: Compute the price of an illiquid 4-year 5% annual coupon bond, given 2 similar credit quality bonds have the following characteristics. A) A 2-year 4.5% annual bond is priced at 102, and B) and a 5-year 5% annual coupon bond is priced at 101.
(Be precise to 4 decimals.)
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