Bond X is a one-year zero with face value of $1,000 trading at $945 and Bond Y
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Bond X is a one-year zero with face value of $1,000 trading at $945 and Bond Y is a two-year zero with a face value of $1,000 trading at $870:
a. Determine algebraically the implied forward rate f 11.
b. Explain how the forward rate can be attained by a locking-in strategy.
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