CURRENT BOND PRICE $=$ $$1050,$ COUPON payments will be made $$50$ each in $6$ months and $12$ months.

If risk free zero rates are $7\%,$ and $7\mathrm{.}3\%,$ for $6$months and $12$ months $,$ respectively; and forward contract delivery period is $12$ months $.$

e equilibrium $($theoretical$)$ forward price that leads to no arbitrage?

What is the equilibrium $($theoretical$)$ forward price that leads to no arbitrage?

$$977\mathrm{.}60$

$$1177\mathrm{.}60$

$$927\mathrm{.}58$

$$1027\mathrm{.}58$

If forward price is $$1010,$ fill in the blank for the appropriate arbitrage strategy n to solve the last question below.

bove arbitrage strategy, find the arbitrage profit that you'd earn

$$15\mathrm{.}85$ in $12$ months

$$17\mathrm{.}58$ in $12$ months

$$5\mathrm{.}85$ in $12$ months

$$27\mathrm{.}58$ in $12$ months