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Pricing bonds with spot rates: A four-year default-free annual-pay coupon bond is priced at 100...

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Finance

Pricing bonds with spot rates: A four-year default-free annual-pay coupon bond is priced at 100 percent of par. What is its coupon (in percent of par) if annual spot rates are as follows:

r1 = 1.99%, r2 = 2.29%, r3 = 2.36%, r4 = 2.97%

Carry intermediate calcs. to four decimals. Answer to two decimals.

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