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Valuing Bonds (using spot rates) and the term structure of interest rates Question 1 A 7-year bond pays coupons annually, with the first due 1

Valuing Bonds (using spot rates) and the term structure of interest rates

Question 1

A 7-year bond pays coupons annually, with the first due 1 year from now. It has face value equal to 1,000 and coupon rate 6%. The term structure of interests is flat with all spot rates equal to 8%. What is the price of the bond?

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