$1.$ The prices of zero coupon bonds with different maturities are given in the table below

Maturity $($years$)$ Price

$1$ Yr $$926$

$2$ Yrs $$853$

$3$ Yrs $$783$

$4$ Yrs $$710$

$5$ Yrs $$690$

$1.$ What do you expect the rate of return to be on a $5$ year zero coupon bond?

$2.$ The government plans to issue a $4$ year maturity $5\%$ coupon bond with a face value of $$1000.$ At what price and yield should the bond sell? Under the expectations theory, what is the expected realized coupon yield of the $4$ year coupon bond?