A twenty-year Treasury bond with a 4.000% coupon rate is sold at par value in the primary market (assume par value is $100). George purchases the Treasury note at a price of 97.009 when it has seven years left to maturity and it has a 4.503% yield-to-maturity. George holds the Treasury note for two years and then sells it to Bill in the secondary market. Bill then holds the Treasury note to maturity. Assume two years from when George purchases the Treasury note, yield-to-maturities (interest rates) are:

• 2.840% on T-notes with 6-months to maturity
• 3.100% on T-notes with 1-year to maturity
• 3.250% on T-notes with 2-years to maturity
• 3.400% on T-notes with 3-years to maturity
• 3.660% on T-notes with 4-years to maturity
• 3.800% on T-notes with 5-years to maturity
• 4.270% on T-notes with 10-years to maturity

Complete the time line for the original twenty-year Treasury bond. The time line must show only numbers unless it is an unknown variable in which case you can show it as a question mark.

0 1 2

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