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Suppose you invest in zero coupon bonds. One matures in 1 year, paying $100, and its price is $86.93. The other matures in 2 years,

  1. Suppose you invest in zero coupon bonds. One matures in 1 year, paying $100, and its price is $86.93. The other matures in 2 years, paying $1,100, and its price is $943.07.
    1. Compute the yield on each bond.
    2. Compute the duration for each bond, assuming they settled on 3/1/2018 and they mature exactly one- and two-years later, respectively.

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