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Suppose that you buy a 13-year zero-coupon bond today with a face value of $100 and that the yield curve is currently flat at 8.5%
Suppose that you buy a 13-year zero-coupon bond today with a face value of $100 and that the yield curve is currently flat at 8.5% pa nominal. Immediately after purchasing the bonds, the yield curve becomes flat at 9.5% pa nominal. Assuming semi-annual compounding and that the bond is sold after 4 years, what is the annualized holding period yield on this bond?
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