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Suppose that all investors expect that interest rates for the 4 years will be as follows: Year Forward Interest Rate 0 (today)3 % 1 4

Suppose that all investors expect that interest rates for the 4 years will be as follows: Year Forward Interest Rate 0 (today)3 % 1 4 % 2 5 % 3 6 % What is the price of a 2-year maturity bond with a 5% coupon rate paid annually? (Par value = $1,000.) Group of answer choices $1,092.97 $1,054.24 $1,028.51 $1,073.34 None of the options are correct

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