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Prices and yields to maturity on four zero-coupon bonds: MaturityYield to MaturityPrice1 Year5%$952.382 Years6%$890.003 Years7%$816.304...

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Finance

Prices and yields to maturity on four zero-coupon bonds: MaturityYield to MaturityPrice1 Year5%$952.382 Years6%$890.003 Years7%$816.304 Years8%$735.03 What is the short rate (the one year lending rate at the beginning of the year) that will prevail in the fourth year? Question 8 options: a) 11.12% b) 11.05% c) 8.00% d) 11.00%

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