You have $1,000 to invest over an investment horizon of three
years. The bond market offers various options. You can buy (i) a
sequence of three one-year bonds; or (ii) a three-year bond; The
current yield curve tells you that the one-year, two-year, and
three-year yields to maturity are 3 percent, 4 percent, and 4.4
percent, respectively. You expect that one-year interest rates will
be 4 percent next year and 5 percent the year after that. Assuming
annual compounding, compute...