Use this information to plot a Treasury Yield Curve

970 31) Yield curve and business cycle (10 points total) a. Compute the annual yield to maturity for each bond shown below (5 points). Current Treasury Years to Annual Par Coupon Annual YTM, % bond maturity price, coupon frequency value, rate, % $ 1 990 3.00 Annual 1,000 PV=-990, FV=1,000, PMT=30(1,000*3%), N=1 YTM-4.04 B 5 360 Semi- 1,000 PV=-970, FV=1,000, annual PMT=18(1,000*3.60%/2), N=1015*2) YTM-4.27% 10 960 4.00 Semi- 1,000 PV--960, FV=1,000, annual PMT-20(1,000*4%/2), N=20 YTM-4.50% D 20 950 4.40 Quarterly 1,000 PV=-950, FV=1,000, PMT-11(1,000*4,40%/4), N-80 YTM4.79% 30 940 4.80 Quarterly 1,000 PV=-940, FV 1,000, PMT-12/1,000*4.80%/4), N=120 YTM-5.20% E Gtv go 888 00 @ 2 $ 1 3 4 % 5 6 7 8 Q W E R T Y U b. Use the above results to plot a Treasury yield curve (3 points). c. Describe the above yield curve, then explain what future economic conditions the yield curve predicts and why (2 points)