Question: 1 . You are evaluating a 2 - year callable corporate bond with the following terms: Face value: $ 1 0 0 . Coupon rate:

1. You are evaluating a 2-year callable corporate bond with the following terms: Face value: $100. Coupon rate: 6%; Callable anytime at $100(the issuer can redeem at $100). Expected interest rate movement: Current market rate: 6%. Each year, the market rate can move: Up by 1% or Down by 1%. If the bond is currently trading at $96, would you buy it?

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