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Price a 3-year, 2% annual coupon, $1000 par bond using the following calibrated model for one-year interest rate. All rates are expressed on a bond
Price a 3-year, 2% annual coupon, $1000 par bond using the following calibrated model for one-year interest rate. All rates are expressed on a bond equivalent basis. Assume annual compounding. Round your answer to 2 decimal places. t = 0 t = 1 t = 2 r_2,HH = 0.038 r_1,H = 0.024 r_0 -0.014 r_2,HL = 0.022 r_1,L = 0.006 r_2,LL = 0.017 Price a 3-year, 2% annual coupon, $1000 par bond using the following calibrated model for one-year interest rate. All rates are expressed on a bond equivalent basis. Assume annual compounding. Round your answer to 2 decimal places. t = 0 t = 1 t = 2 r_2,HH = 0.038 r_1,H = 0.024 r_0 -0.014 r_2,HL = 0.022 r_1,L = 0.006 r_2,LL = 0.017
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