The annual continuously compounded 6-month and 1-year zero


The annual continuously compounded 6-month and 1-year zero rates are 3% and 4%, respectively. A 1.5-year bond that pays coupons of $2 every six months currently sells for $98.52. What is the 1.5-year zero rate with continuous compounding? Show details of your solution.

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Financial Management: The annual continuously compounded 6-month and 1-year zero
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