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With explanations please. Problem 15-16 Suppose that a 1-year zero-coupon bond with face value $100 currently sells at $93.27, while a 2-year zero sells at
With explanations please.
Problem 15-16 Suppose that a 1-year zero-coupon bond with face value $100 currently sells at $93.27, while a 2-year zero sells at $83.53. You are considering the purchase of a 2-year-maturity bond making annual coupon payments. The face value of the bond is $100, and the coupon rate is 11% per year. a. What is the yield to maturity of the 2-year zero?(Do not round intermediate calculations. Round your answers to 3 decimal places.) Yield to Maturity 2-year zero b. What is the yield to maturity of the 2-year coupon bond? (Do not round intermediate calculations. Round your answers to 3 decimal places.) Yield to Maturity 2-year coupon bond c.What is the forward rate for the second year? (Do not round intermediate calculations. Round your final awer to 2 decimal places.) Forward rateStep by Step Solution
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