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Suppose that you observe a corporate bond with an annual coupon of 7% (paid semiannually) that matures in 18 months. What is the price of
Suppose that you observe a corporate bond with an annual coupon of 7% (paid semiannually) that matures in 18 months. What is the price of this bond if you observe the following yield curve for this companys bonds?
Maturity | 6 months | 12 months | 18 months | 24 months |
Rate | 6% | 7% | 8% | 9% |
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