Question: a) A treasury STRIPS with 13 years until maturity has a face value of $10,000. Its trading at a price of $4,131. Whats the YTM

a) A treasury STRIPS with 13 years until maturity has a face value of $10,000. Its trading at a price of $4,131. Whats the YTM of the STRIPS?

b) Suppose the real rate is 2% and the inflation is currently at 2.5%. What will you expect the yield on the treasury bills?

c) A coupon bond with 5 years to maturity has a face value of $1,000 and a coupon of $40 a year. Its trading at a price of $950. Whats the coupon rate and current yield?

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