Assuming the sequence of spot rates shown below what is the


An investor considers the purchase of a 2-year bond with a 5% coupon rate, with interest paid annually. Assuming the sequence of spot rates shown below, what is the price of the bond?

Time-to-Maturity      Spot Rates

1 year                                     3%

2 years                                   4%

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Financial Management: Assuming the sequence of spot rates shown below what is the
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