Compute forward rates and to calculate bond prices

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An analyst gathered the following information (assuming annualYears to Maturity: 1, 2, 3Spot Rate: 3%, 4%, 5% compounding) to compute forward rates and to calculate bond prices. 

Based on the data above, please compute:  

  1. One-year forward rates (F1,2) and (F2,3);
  2. Two-year forward rate (F1,3);
  3. Price of a 3-year 4% coupon bond (with coupons paid annually), assuming the par value is $1,000.

Reference no: EM132788051

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