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14)Find   the   bond   yield   as   an   effective   annual   rate for   a   bond   with   annual   coupon   of&nbs

14)Find   the   bond   yield   as   an   effective   annual   rate for   a   bond   with   annual   coupon   of   $200,  
Face   value   of   $1000,   and   maturity   in   3   years where   the   spot   rates   are   as   follows.  
Term to   maturity Spot   Rate
One   year   from   today,   r1 5%
Two   years   from   today,   r2 6%
Three   years   from   today,   r3 7%
a) 3.334%
b) 3.395%
c) 6.578%
d) 6.789%
e) 13.578%

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