Basic Review Problems

Problems $1.$ and $2.$ use rates from the following yield curve table:

A $3-$year annual$-$coupon $1,000$ par value bond has a coupon rate of $4\%.$ Use

the yield curve above to find the bond's price $P,$ and then use that price to

find its yield to maturity.

Calculate the $1-$year and $2-$year forward rates.