Consider two bonds. The first is a 6% coupon bond with six years to maturity, and...

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Finance

Consider two bonds. The first is a 6% coupon bond with six yearsto maturity, and a yield to maturity of 4.5% annual rate,compounded semi-annually. The second bond is a 2% coupon bond withsix years to maturity and a yield to maturity of 5.0%, annual rate,compounded semi-annually. a. Draw a cash flow diagram for eachbond. b. Calculate the current price per $100 of face value foreach bond.

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Consider two bonds. The first is a 6% coupon bond with six yearsto maturity, and a yield to maturity of 4.5% annual rate,compounded semi-annually. The second bond is a 2% coupon bond withsix years to maturity and a yield to maturity of 5.0%, annual rate,compounded semi-annually. a. Draw a cash flow diagram for eachbond. b. Calculate the current price per $100 of face value foreach bond.

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