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You have a catastrophe bond with a 1 year maturity. principal amount is $1,000 and the coupon rate is 9%. Assume that the estimated expected

You have a catastrophe bond with a 1 year maturity. principal amount is $1,000 and the coupon rate is 9%. Assume that the estimated expected loss as a percentage of the principal amount is 4%. Assume tone-year risk-free return is 3%. Also, assume that the required risk premium is 2%. Use the discounted cash flow model to find the value of the bond when it is issued

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