8. Yields on three Treasury notes are given as follows: Maturity Coupon Yield to Maturity Bond A 1 year 0% 5.25% Bond B 2 year 5% 5.50% Bond C 3 year 6% 6.00% Coupons are paid annually. (A) What are the prices of the 1-year, 2-year, and 3-year notes? (B) What is the spot interest rates for years 1, 2 and 3? (3 marks) (6 marks) (C) What is the implied forward rate for year 2 to year 3 1f2? (1 mark) 8. Yields on three Treasury notes are given as follows: Maturity Coupon Yield to Maturity Bond A 1 year 0% 5.25% Bond B 2 year 5% 5.50% Bond C 3 year 6% 6.00% Coupons are paid annually. (A) What are the prices of the 1-year, 2-year, and 3-year notes? (B) What is the spot interest rates for years 1, 2 and 3? (3 marks) (6 marks) (C) What is the implied forward rate for year 2 to year 3 1f2? (1 mark)