What should the market price of bond three be?

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Bond 1 is a one-year zero-coupon bond with $2,000 face value and a market price of $850. Bond 2 is a two-year zero-coupon bond with $3,000 face value and a market price of $695. Bond 3 is a two-year bond that trades in the similar market as Bonds 1 and 2, similar risks, a $4,000 face value, annual coupon payment of 6%. What should the market price of Bond 3 be?

Reference no: EM131606272

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