Recall that the Par Rate is the coupon rate such that a bond sells at par. A
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Question:
Recall that the Par Rate is the coupon rate such that a bond sells at par. A company wants to issue a 2 year bond with annual payment that sells at par. Assume R(0,1) = 4% and R(0,2)= 6%.The coupon rate should be set at
7.3%
4%
5.94%
6.21%
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