Question: Please show all work and Math worked out for Part (A) and (B). Thank you! ($) 6. The following table gives the prices of bonds
Please show all work and Math worked out for Part (A) and (B). Thank you!
($) 6. The following table gives the prices of bonds of various maturities: Face value Time to maturity Semi-annual coupon Bond price (years) 0.5 95 100 107.4 100 81.63 100 1 1.5 (a) Compute the forward rates for the following periods: 6 months to 12 months and 12 months to 18 months. (b) Compute the price of an 18-month bond that pays a coupon of 10% every six months and has a face value of $1000
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