Question
Suppose that all investors expect that interest rates for the 4 years will be as follows: Year Forward Interest Rate 0 (today)5 % 1 7
Suppose that all investors expect that interest rates for the 4 years will be as follows:
| Year | Forward Interest Rate | |
| 0 | (today)5 | % |
| 1 | 7 | % |
| 2 | 9 | % |
| 3 | 10 | % |
What is the yield to maturity of a 3-year zero-coupon bond?
rev: 08_27_2019_QC_CS-175809
Multiple Choice
-
9.00%
-
None of the options are correct.
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6.99%
-
7.49%
-
7.03%
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Financial and managerial accounting
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
1st edition
978-1118016114
