Assume 6-month zero rate is 4.045%. Also use the following table to answer the questions below.

The following table gives the prices of bonds:

Face Value	Time To Maturity	Coupon / Year	Bond Price
100	1 Year	0	97
100	1.5 Year	15	98.5

*Half of the stated coupon is paid every six months ** all rates are continuously compounded

What is the zero rate for 1 year?

1) 3.046%

1) 4.545%

1) 3.455%

1) 5.206%

2. What is the zero rate for 1.5 year?

2) 12.245%

2) 13.522%

2) 16.544%

2) 15.377%