A25176 31. Consider the following internation in Table 3. on three deswers free books with amuul coupon payments and face face value of low Toble S. Bond Time to moluntly Cyrst A Yould to w 8 Coupe de 4 6.5 8 2 3 S 6 8 a) Determine the prices of bords A,B,C. 6). Determbe the current term sructure of spre interest retas and bookly commer On the shape of the tem services. c). Demonstrate how you can use bands A, B and to replicate a 3-year zero Con but with a face value of $10w.. d). It the 3-year zero coupon band in c) has manae price of 5780 show how you an astrage protie. Make sure to clearly detail the able Strategy con cara el. Assume you can buy and sell zero campon bad (face value (law) of any matuty and that all bands are at that no-oditrage price implied by the tarm Structure calculated into). An investor expus to recere a cash infloro at $5 million in one year fire, which she then plan to lead are innedately. The term of the loon will be two years, with focal amper facil to the lovestor of end of each year olany with the repayment at the cache principal amare are neturity of the ban Explan how the weste care anuge Al kan tukay and lek in the interest rate on the loan sesudy excluding how many unity of the required to be lang (stands and the resulted cash flows. What show bual need A25176 31. Consider the following internation in Table 3. on three deswers free books with amuul coupon payments and face face value of low Toble S. Bond Time to moluntly Cyrst A Yould to w 8 Coupe de 4 6.5 8 2 3 S 6 8 a) Determine the prices of bords A,B,C. 6). Determbe the current term sructure of spre interest retas and bookly commer On the shape of the tem services. c). Demonstrate how you can use bands A, B and to replicate a 3-year zero Con but with a face value of $10w.. d). It the 3-year zero coupon band in c) has manae price of 5780 show how you an astrage protie. Make sure to clearly detail the able Strategy con cara el. Assume you can buy and sell zero campon bad (face value (law) of any matuty and that all bands are at that no-oditrage price implied by the tarm Structure calculated into). An investor expus to recere a cash infloro at $5 million in one year fire, which she then plan to lead are innedately. The term of the loon will be two years, with focal amper facil to the lovestor of end of each year olany with the repayment at the cache principal amare are neturity of the ban Explan how the weste care anuge Al kan tukay and lek in the interest rate on the loan sesudy excluding how many unity of the required to be lang (stands and the resulted cash flows. What show bual need
