Question: A 2 - year zero - coupon bond with $ 1 0 0 principal is trading at $ 9 5 . 0 0 . Price

A 2-year zero-coupon bond with $100 principal is trading at $95.00. Price of a 2-year
coupon bond with annual coupon of $10 and principal of $100 is $104.00.
(a) What is the 2-year spot rate from t=0 to t=2?
(b) What is the spot rate per year from t=0 to t=1?
A 2-year zero-coupon bond with $100 principal is trading at $95.00.

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