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timeline with how ever many years is sufficient this is all the info known for the question(s) 9. Why would it be incorrect to use

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timeline with how ever many years is sufficient

this is all the info known for the question(s)

9. Why would it be incorrect to use the yield to maturity on a 10 year discount bond as the yield to maturity on a 10 year coupon bond. (5 points) 10. The current market price of a one year discount bond with a face value of $100 is $ 89.28. Also, the current market price of a two year 25% coupon bond with a face value of $2000 is $2101.44. (12 points) a) Draw the timeline associated with each bond. b) Determine the spot rates between year 0 and year 1 and between year 1 and year 20. c) Use from part b) to determine the price of a two year discount bond with a face value of $4600. a) Draw the timeline associated with each bond. b) Determine the spot rates between year 0 and year 1 (r.) and between year 1 and year 2 (2). c) Use r, from part b) to determine the price of a two year discount bond with a face value of $4600

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