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Question 1: What is the value of a semi annual zero coupon bond that matures in 20 years, has a maturity of R 1 000 000 and is selling to yield 7.6%?

Question 2: What is the value of a 5 year 7.4 coupon bond that pays interest annually assuming that the appropriate discount rate is 5.6%?

Question 3: A stock is selling at R 70, a 6 month put option with strike price of R 75 is selling for R 13, a 6-month call with strike price of R 75 is selling for R 5, and the risk-free rate is 6%. How much, if anything can be made on an arbitrage?

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