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Business, 24.10.2019 02:30 madisonruh

Suppose that f(0, 1, 1.5) = 4.5%. (this should be almost 0.5 percentage points higherthan what you found above.) using f(0, 1, 1.5) and the given zero coupon yields, construct an arbitrage trading strategy to take advantage of this mispricing. note: it may be to first calculate zero-coupon bond prices for maturities of1-year and 1.5-years.

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Suppose that f(0, 1, 1.5) = 4.5%. (this should be almost 0.5 percentage points higherthan what you f...
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