Question

Intro Treasury spot interest rates are as follows: Maturity (years) 1 2 3 4 Spot rate (EAR) 2% 2.8% 3.1% 4.5% Part 1 To Attempt 1/10 for 10 pts. What is the price of a risk-free zero-coupon bond with 3 years to maturity and a face value of $1,000 (in $)? b+ decimals Submit

Answer 1

A B D E F 1 2 3 Interest Rate for 3 Year Bond= Maturity (No.of Years) = Face Value( Future Value)= Price of the Bond(Present Value)= 3.10% 3 Years $ 1,000.00 $912.48 4 5 6 7

A B D E 1 2 0.031 3 Years Interest Rate for 3 Year Bond= Maturity (No.of Years) = Face Value( Future Value)= Price of the Bond(Present Value)= 4 3 1000 =-PV(E2,E3,,E4) 5 6 7

		Interest Rate for 3 Year Bond=	3.10%
		Maturity (No.of Years) =	3	Years
		Face Value( Future Value)=	$ 1,000.00
		Price of the Bond(Present Value)=	$912.48