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Business, 18.03.2021 01:50 EmilyQuinn3053

Given the following yield curve: One-year bonds yield 8.50%, two-year bonds yield 9.50%, three-year bonds and greater maturity bonds all yield 10.50%. All bonds are paying annual coupons of 9.50%, once a year. You strongly believe that at year-end the yield curve will be flatten around the 3 year rate. Calculate the one year total rate of return for the one-year bond.

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Given the following yield curve: One-year bonds yield 8.50%, two-year bonds yield 9.50%, three-year...

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