1. Answer the following short answer questions in the space provided. Show your work where necessary. (a) Compute the price of a 5-year zero coupon bond assuming the YTM equals i(2)= 6%. Assume a face value of $1000. (b) A 5% coupon 10-year bond is trading at 88.50 . Estimate the YTM using the method of averages. (c) Suppose the 2-year spot rate is 5% and the 3-year spot rate is 6%. Compute the 1year forward rate over year 3. (Assume all rates in this question are expressed in annual compounding.)