Question
3. One year treasuries yield 5% and two year Treasuries yield 5.50%. You have a two year time horizon. You are considering a one year
3. One year treasuries yield 5% and two year Treasuries yield 5.50%. You have a two year time horizon. You are considering a one year roll of Treasuries. What would you have to get in the second year to beat just holding the two year Treasury? (Carry your answer out three decimal places.) 4. What are the components of a bond? 5. Assume Capital Inc has an outstanding 15 year bond with a 10% coupon (annual pay) with a par value of $1000. The market yield for this bond is 15%. What is the price/present value of the bond? If the bond is callable in ten years at 102 what would the yield to the call be given the price you calculated above.
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