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Suppose that a 4-year bond has a face value of 1000 and pays semi-annual coupons of 40. 1) If the YTM is 10%: a) What

Suppose that a 4-year bond has a face value of 1000 and pays semi-annual coupons of 40.

1) If the YTM is 10%:

a) What is the price?

b) What is the effective annual rate?

2) If the price is 1000 then what is the YTM?

3) If the price is 1070 then what is the YTM?

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