Corporate FInance Assignment/ Professional Essay Writers
May 16th, 2020
1. You want to invest a sum of money for two years and have two alternatives:
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Alternative 1: 3-year 5% coupon AAA bond selling at par.
Alternative 2: A AAA bank deposit which pays according to the following rates:
The 1-year spot rate of 4.0%
1-year forward rate one year from now 4.5%
1-year forward rate two years from now 5%
Analyze the alternatives to determine which one is the better deal. (8 marks.) Get Finance Help Today