Question: A us government 2 year T note has a face value of 1,000 and pays annual coupons of 65. The first coupon is due in

A us government 2 year T note has a face value of 1,000 and pays annual coupons of 65. The first coupon is due in one year. What is the correct price for the coupon bond today. Use the term structure of interest rates shown below.

term. Spot rate

1 year 2.5%

2 years 9.5%

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