Question: A one year zero coupon bond has an effective annual rate of 7%. A three year zero coupon bond has an effective annual rate of

A one year zero coupon bond has an effective annual rate of 7%. A three year zero coupon bond has an effective annual rate of 10%. If a 3 year coupon-bearing bond that pays coupons of 10% annually has a yield of 9.6%, what is the effective annual rate of a two year zero coupon bond?

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