Question: 1.Using the semi-annually compounded yield curve given below, price the following securities. a.5-year zero coupon bond b.7-year coupon bond paying 15% semiannually c.4-year coupon bond
1.Using the semi-annually compounded yield curve given below, price the following securities.
a.5-year zero coupon bond
b.7-year coupon bond paying 15% semiannually
c.4-year coupon bond paying 7% quarterly
d.3 1/4-year coupon bond paying 9% semiannually
Maturity Yield 0.25 6.33% 0.5 6.49% 0.75 6.62% 1 6.71% 1.25 6.79% 1.5 6.84% 1.75 6.87% 2 6.88% 2.25 6.89% 2.5 6.88% 2.75 6.86% 3 6.83% 3.25 6.80% 3.5 6.76% 3.75 6.72% 4 6.67% 4.25 6.62% 4.5 6.57% 4.75 6.51% 5 6.45% 5.25 6.39% 5.5 6.31% 5.75 6.24% 6 6.15% 6.25 6.05% 6.5 5.94% 6.75 5.81% 7 5.67% 7.25 5.50% 7.5 5.31%
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