Question

The following table summarizes prices of various default-free zero-coupon bonds ($100 face value): 1 Maturity (years) Price (per $100 face value) $95.19 $90.71 $86.04 $81.16 $76.08 a. Compute the yield to maturity for each bond. b. Plot the zero-coupon yield curve (for the first five years). c. Is the yield curve upward sloping, downward sloping, or flat? Note: Assume annual compounding. a. Compute the yield to maturity for each bond. The yield on the 1-year bond is %. (Round to two decimal places.)

PLEASE INCLUDE B AND C IN ANSWER. SAYS 6 numbers need to be entered total

Answer 1

D E F G H I А Yield to Maturity for each bond Maturity (year) Current price of bond 95.19 Face value 100 90.71 100 86.04 100 81.16 100 76.08 100 YTM OF ZCB YTM (%) 0.051 5.10% 0.050 5.00% 0.051 5.10% 0.054 5.40% 0.056 5.60% Zero coupon yield curve Maturity (year) YTM(%) 5.10% 1102/5.03 5.103 5.403 5.60% 5.00% 5.10% 5.40% 5.60% Yield To Maturity 5.70% 5.60% 5.50% 5.40% 5.30% 5.20% 5.10% 5.00% 4.90% 4.80% 4.70% YTM(%) + C The yield curve is upward sloping