Question
The price of a two-year zero-coupon corporate bond with a notional value of 1000 is 895.5. The risk-free interest rate, or r, is two percent.
The price of a two-year zero-coupon corporate bond with a notional value of 1000 is 895.5. The risk-free interest rate, or r, is two percent. What is the fair value of a Five year zero coupon bond with the same seniority (i.e.R) issued by the same issuer if the bond default recovery rate R is 40percent and r, R, and the default (hazard) rate 
are all constant?
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Evolutionary Finance
Authors: Bartholomew Frederick Dowling
1st Edition
0230502199, 9780230502192
