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1-Year Forward Rate Year 4. 6% 2 4 .9% titio What should the purchase price of a 1-year zero-coupon bond be if it is purchase

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Answer #1

Value of Zero COupon Bond = Par Value * PVF(r%, n)

= $ 1000 * PVF(4.6%, 1)

= $ 1000 * 0.9560

= $ 956.02

Option D is correct.

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