1. Suppose that an analyst needs to value a 2-year, 4% coupon corporate bond (Bond X) that pays coupon semiannually. Assume that the bond is not actively traded and that there are no recent transection reported for this particular security. However, there are quoted prices for two corporate bonds that pay coupon semiannually and have very similar credit quality:
   • Bond A: 1-year, 3% coupon rate, traded at a price of 98.500 per 100 of par.
   • Bond B: 4-year, 5% coupon rate, traded at a price of 102.250 per 100 of par.

Estimate the price for Bond X using matrix pricing.