My UINs last two digits are 28

Compute the OAS, s* 2. (8 points) Below is the price of a 7-year callable bond and that bond is not callable until year 2 (second interest rate step), You will find an OAS, s*, such that callable bond priced off the calibrated forward rate tree equals the market price. Note: this is also another optimization, because you will want to minimize (Pmkt P(s*))2 as a function of s*. Report your result to the nearest 1/10 of a basis point. Term 7 years Coupon UIN Dependent Call Price $101 Non-call period Market Price 2 years $98.50 The coupon is determined as follows: Coupon = 7.2 + ID/500, where ID is the last 2 digits of your UIN. Compute the OAS, s* 2. (8 points) Below is the price of a 7-year callable bond and that bond is not callable until year 2 (second interest rate step), You will find an OAS, s*, such that callable bond priced off the calibrated forward rate tree equals the market price. Note: this is also another optimization, because you will want to minimize (Pmkt P(s*))2 as a function of s*. Report your result to the nearest 1/10 of a basis point. Term 7 years Coupon UIN Dependent Call Price $101 Non-call period Market Price 2 years $98.50 The coupon is determined as follows: Coupon = 7.2 + ID/500, where ID is the last 2 digits of your UIN