Question: Term Structure: Consider the following Treasury yields a. find the missing spot rates Period Year Yield to Maturity (%) Spot Rate (%) 1 0.5 3.00

Term Structure: Consider the following Treasury yields

a. find the missing spot rates

Period

Year

Yield to Maturity (%)

Spot Rate (%)

1

0.5

3.00

2

1

3.70

3

1.5

4.30

4

2

5.20

b. The implied forward rate from 6 months to one year is closest to:

a. 4.40%

b. 3.98%

c. 3.70%

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