Suppose that there is a bank that is offering to lend and/or borrow money at an interest rate of 8% (regardless of the time-to-maturity of the loan). Further suppose that there is a two-year coupon...

Suppose that there is a bank that is offering to lend and/or borrow money at
an interest rate of 8% (regardless of the time-to-maturity of the loan).
Further suppose that there is a two-year coupon bond trading with a face
value of $100 and a coupon rate of 5% trading in the market. Price the bond
using an explicit no-arbitrage argument.
a) Suppose that the bond in the previous question is actually trading for $92.
Show how you could exploit the mispricing to make an arbitrage profit.( Question)