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.)

$1,092.97

$1,073.34

$1,054.24

$1,028.51

None of the options are correct.