6. Given the following: 23-Oct 2020 Maturity Maturity Ask Year Date Bid Ask Yield 1 8/15/2021 99.896 99.96 0.05 2 8/15/2022 99.722 99.812 0.104 3 8/15/2023 99.338 99.477 0.187 4 8/15/2024 98.752 98.977 0.271 58/15/2025 97.791 98.026 0.416 6 8/15/2026 96.58 96.913 0.542 7 8/15/202795.269 95.593 0.665 88/15/2028 93.857 94.219 0.766 98/15/2029 92.289 92.674 0.868 10 8/15/2030 90.608 91.051 0.961 11 8/15/2031 88.79 89.273 1.056 128/15/2032 87.14 | 87.658 1.122 13 8/15/2033 85.339 85.895 1.195 148/15/2034 83.73 | 84.312 1.244 158/15/2035 81.946 82.569 1.302 16 8/15/2036 80.175 80.813 1.357 17 8/15/2037 78.588 79.253 1.393 18 8/15/203876.951 77.641 1.432 198/15/2039 75.382 76.096 1.463 20 8/15/2040 73.575 74.309 1.511 21 8/15/2041 71.922 72.616 1.55 22 8/15/204270.182 71.091 1.577 23 8/15/2043 68.406 69.192 1.628 24 8/15/2044 66.778 67.571 1.661 25 8/15/2045 65.149 65.955 1.692 26 8/15/204663.682 64.501 1.714 27 8/15/2047 62.412 63.246 1.724 28 8/15/2048 61.29 62.149 1.725 298/15/2049 60.22 61.086 1.726 a. What is the 10-year spot rate? b. What is the 5-year spot rate? c. What is the yield-to-maturity of a 6-year zero coupon bond? d. What is the discount price of a 20-year bond? e. Your relative promises to pay you $5,000, 12 years from now. What is the maximum amount you would lend to your relative today? Why? f. What is the present value of risk-free $1 to be received 15-years from now? & The bond maturing on 8/15/2040 has an ask price of 74.309. Given this price show that the reported ask yield 1.511 is correct. 6. Given the following: 23-Oct 2020 Maturity Maturity Ask Year Date Bid Ask Yield 1 8/15/2021 99.896 99.96 0.05 2 8/15/2022 99.722 99.812 0.104 3 8/15/2023 99.338 99.477 0.187 4 8/15/2024 98.752 98.977 0.271 58/15/2025 97.791 98.026 0.416 6 8/15/2026 96.58 96.913 0.542 7 8/15/202795.269 95.593 0.665 88/15/2028 93.857 94.219 0.766 98/15/2029 92.289 92.674 0.868 10 8/15/2030 90.608 91.051 0.961 11 8/15/2031 88.79 89.273 1.056 128/15/2032 87.14 | 87.658 1.122 13 8/15/2033 85.339 85.895 1.195 148/15/2034 83.73 | 84.312 1.244 158/15/2035 81.946 82.569 1.302 16 8/15/2036 80.175 80.813 1.357 17 8/15/2037 78.588 79.253 1.393 18 8/15/203876.951 77.641 1.432 198/15/2039 75.382 76.096 1.463 20 8/15/2040 73.575 74.309 1.511 21 8/15/2041 71.922 72.616 1.55 22 8/15/204270.182 71.091 1.577 23 8/15/2043 68.406 69.192 1.628 24 8/15/2044 66.778 67.571 1.661 25 8/15/2045 65.149 65.955 1.692 26 8/15/204663.682 64.501 1.714 27 8/15/2047 62.412 63.246 1.724 28 8/15/2048 61.29 62.149 1.725 298/15/2049 60.22 61.086 1.726 a. What is the 10-year spot rate? b. What is the 5-year spot rate? c. What is the yield-to-maturity of a 6-year zero coupon bond? d. What is the discount price of a 20-year bond? e. Your relative promises to pay you $5,000, 12 years from now. What is the maximum amount you would lend to your relative today? Why? f. What is the present value of risk-free $1 to be received 15-years from now? & The bond maturing on 8/15/2040 has an ask price of 74.309. Given this price show that the reported ask yield 1.511 is correct
