The yield to maturity on 1 - year zero - coupon bonds is currently 4 . 5
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Question:
The yield to maturity on year zerocoupon bonds is currently ; the YTM on year zeros is The Treasury plans to issue a year maturity coupon bond, paying coupons once per year with a coupon rate of The face value of the bond is $
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At what price will the bond sell?
Note: Do not round intermediate calculations. Round your answer to decimal places.
What will the yield to maturity on the bond be
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If the expectations theory of the yield curve is correct, what is the market expectation of the price for which the bond will sell next year?
Note: Do not round intermediate calculations. Round your answer to decimal places.
Recalculate your answer to part c if you believe in the liquidity preference theory and you believe that the liquidity premium is
Note: Do not round intermediate calculations. Round your answer to decimal places.
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