Question: See the google drive to answer the question please, thank you https://drive.google.com/file/d/1XyNen4OSrViQCkkui23UkrBOoBucCmOF/view?usp=sharing Based on the risk-free yield curve given below and assuming semi-annual compounding using

See the google drive to answer the question please, thank you

https://drive.google.com/file/d/1XyNen4OSrViQCkkui23UkrBOoBucCmOF/view?usp=sharing

Based on the risk-free yield curve given below and assuming semi-annual compounding using a 30/360 day count convention (as used in class) calculate:

1) the discount factors (6 decimal places)

2) the zero-coupon yield curve (spot rate curve) (6 decimal places)

3) All implied forward rates contained within the yield curve (6 decimal places)

4) Suppose you are quoted a 6-month forward rate starting 6 months from today (0.5F*1.0) that is 10 basis points (0.10%) higher than the theoretical 6-month forward rate starting 6 months from today (0.5F1.0) that you calculated in part 3. Create an investment strategy using an arbitrage table, to exploit this arbitrage opportunity.

5) Suppose you are quoted a 6-month forward rate starting 6 months from today (0.5F*1.0) that is 15 basis points (0.15%) lower than the theoretical 6-month forward rate starting 6 months from today (0.5F1.0) that you calculated in part 3. Create an investment strategy using an arbitrage/payoff table, to exploit this arbitrage opportunity.

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