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You are a bond trader, and there has been a power failure in New York City. You and other traders have taken to a street

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You are a bond trader, and there has been a power failure in New York City. You and other traders have taken to a street corner in order to keep trading. You can buy or sell the following bonds with the following cash flows (or CF) at the following prices. All bonds mature at or before the end of year 3. Price Coupon Face Value Bond A 100.00 2% 95.00 112.00 3% 7% $100 $100 $100 (Answers) Bond Price Today Buy (shares) Sell (shares) Cash flow NOW Cash flow Year 1 Cash flow Year 2 Cash flow Year 3 A 100.00 B 95.00 112.00 Total

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