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Assignment 8(2)

# Assignment 8(2) - Maple T.A Gradebook...

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System Homepage » Class Homepage » Student Details » Student Assignment Details ActSci 231 W09 : Gradebook Welcome Po-Wei Chuang [ My Profile ] Assignment detail for Po-Wei Chuang in Assignment 8: Po-Wei Chuang Login: pchuang Email: [email protected] Student ID: 20260696 Assignments completed: 9 Assignments active: 0 Question Grade 1 The following are the prices of \$1,300 par value zero-coupon bonds with one and two year maturities: One year maturity: \$1,230 Two year maturity: \$1,150 Calculate the one-year deferred one-year forward rate to four decimal places. Your Answer: 0.0696 Correct Answer: .696e-1 Comment: One year spot rate i: 1,300 = 1,230 * (1+i) Two year spot rate j: 1,300 = 1,150 *(1+j) 2 Then, one-year deferred one-year forward rate k: (1+j) 2 = (1+i)*(1+k) Instructors Comment: 1.0 2 You are given the following table for 6.5% par-value bonds with annual coupons: Term Yield to Maturity 1 1.768% 2 3.0652% 3 3.6322% Use the above table to determine the 2-year spot rate and the 3-year spot rate. Note that the bonds are all 6.5% with annual coupons.

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