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Further assume that the three bonds are of equal value and

Assume that the yield curve for the data of Problem 3 is 10%. Further assume that the three bonds are of equal value and the only bonds existing. Set up a single-index representation of their covariance. What is the covariance between all pairs of bonds?

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Finance Basics: Further assume that the three bonds are of equal value and

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Finance Basics: Further assume that the three bonds are of equal value and

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