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You have been given the following coupon yield curve: Maturity (years) 1 3 4 0% 8% 10% 12% Coupon Rate (annual payments) YTM 1.5% 2.31%
You have been given the following coupon yield curve: Maturity (years) 1 3 4 0% 8% 10% 12% Coupon Rate (annual payments) YTM 1.5% 2.31% 3.10% 4.12% one Use arbitrage to determine the YTM of a two-year, zero coupon bond. (Hint: The price of a year zero coupon bond with face value of $80 is $78.81.) 2.31% 2.34% 1.35% 1.52%
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