PLEASE SHOW ALL WORK FOR COMPUTATION ON EXCEL AND ANSWER THE REST ASAP.

Bond Principal Maturity Coupon Zero Rates 10.66% 1 ! 1000 .250 2 100 0. 50 ! 100 4 100 1.5 i 100 2 9 100 2.5 9.5 i 100 3 10.2 100 3.5 11.8 9 100 12.4 10 i 100 4.5 13.6 11 100 5 15 Bond Price 97.5 96.9 95 94.7 100.6 100.9 101.3 101.9 102.3 102.6 103.5 a. Compute the spot rate using the bootstrapping method. b. Draw the yield curve of spot rates (i.e. term structure of spot rates). c. Is that an upward slope or downward slope? d. What is the spread between a 5 year bond rate and a 6month yield? e. Based on the answer of d, do you think the slope is steep? If yes, why? If not, why not? Bond Principal Maturity Coupon Zero Rates 10.66% 1 ! 1000 .250 2 100 0. 50 ! 100 4 100 1.5 i 100 2 9 100 2.5 9.5 i 100 3 10.2 100 3.5 11.8 9 100 12.4 10 i 100 4.5 13.6 11 100 5 15 Bond Price 97.5 96.9 95 94.7 100.6 100.9 101.3 101.9 102.3 102.6 103.5 a. Compute the spot rate using the bootstrapping method. b. Draw the yield curve of spot rates (i.e. term structure of spot rates). c. Is that an upward slope or downward slope? d. What is the spread between a 5 year bond rate and a 6month yield? e. Based on the answer of d, do you think the slope is steep? If yes, why? If not, why not