Question: Check my work 00 Currently, the term structure is as follows: One-year bonds yleld 775%, two-year zero-coupon bonds yield 8.75%, three-year and longer maturity zero

Check my work 00 Currently, the term structure is as follows: One-year bonds yleld 775%, two-year zero-coupon bonds yield 8.75%, three-year and longer maturity zero coupon bonds all yield 9.75%. You are choosing between one, two, and three-year maturity bonds all paying annual coupons of 8.75%. You strongly believe that at year-end the yield curve will be flat at 9.75% a. Calculate the one year total rate of return for the three bonds. (Do not round intermediate calculations. Round your answers to 2 decimal places.) 10 BOOK One Year Two Years Three Years One year total rate of retum Bren b. Which bond you would buy? One year bond Two-year bond Three-year bond

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