5) The following table contains data to calculate forward rates using pure expectations theory. a) Find...
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5) The following table contains data to calculate forward rates using pure expectations theory. a) Find the yield on a 20 year bond, 10 years forward (1020). b) Find the yield on a 5 year bond, 2 years forward (2rs). Maturity 1 year Yield 4.73% 2 years 4.375% 3 years 4.25% 5 years 4.125% 7 years 4.00% 10 years 2.75% 20 years 3.375% 30 years 3.00% 5) The following table contains data to calculate forward rates using pure expectations theory. a) Find the yield on a 20 year bond, 10 years forward (1020). b) Find the yield on a 5 year bond, 2 years forward (2rs). Maturity 1 year Yield 4.73% 2 years 4.375% 3 years 4.25% 5 years 4.125% 7 years 4.00% 10 years 2.75% 20 years 3.375% 30 years 3.00%
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