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A fixed-income quant is on trial for claims they are making: (10% of total points) a)For a certain bond, the quant claims that the bond

A fixed-income quant is on trial for claims they are making:(10% of total points)

a)For a certain bond, the quant claims that thebond priceis a martingale.You areunsureif the bond price is a martingale.Can the quant be correct?Assume: Interest rates are positive throughout.

b)In a different bond, the analyst claims that thediscountedbondpriceis a martingale.You areunsureif the bond price is a martingale.Can the quant be correct?

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