Question: QUESTION 49 An analyst uses the following three-year binomial tree for interest rates to value fixed- income investments: Time 0 Time 1 Time 2 5%

QUESTION 49 An analyst uses the following three-year binomial tree for

QUESTION 49 An analyst uses the following three-year binomial tree for interest rates to value fixed- income investments: Time 0 Time 1 Time 2 5% 4.50% 3% 4% Using this tree, which of the following values is closest to the value today of a two-year 5% annual pay coupon bond? a) 99.46. b) 104.36. c) 104.46. OA

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