In: Finance
The adjacent table contains the details of four bonds currently traded in the market. Using this information calculate the no arbitrage price of a 3 year 8% annual coupon bond.
Maturity |
Price |
Coupon |
1 |
$ 97.29 |
4.00% |
2 |
$ 93.41 |
3.50% |
3 |
$ 94.00 |
5.00% |
4 |
$ 96.65 |
6.50% |