QUESTION TWO (e) You are given the following information 1-year forward rate Year 5.8% 6.4% 7.1% 73% 7.4% Required: What should be the purchase price of a two year zero coupon bond i is purchased at the beginning of year 2 and has a face val sh.1,000? (0) 13 marks] What would the yield to maturity be on a four year zero coupon bond purchased today? (ii) 3 marks Calculate the price at the beginning of year 1 of a 10% annual coupon bond with face value of Sh.1,000 and 5 years to maturity (iii) 15 marks] What should be the holding period return of a 9% annual coupon bond with face value of sh. 1,000 and five years to maturity if it is purchas at the beginning of year 1 and sold at the beginning of year assuming that rates do not change? (iv) ed b) Consider tn