Bond Pricing, Duration, and Convexity 1. Using the following data from August 22, 2023, plot (xy-scatter diagram) the corporate A-rated yield and Treasury yield curves and calculate the default premium spread (in basis points) for each instrument. a) 6 month corporate with a yield of 6.05% and Treasury with a 5.46% yield b) 1 year corporate with a yield of 6.00% and Treasury with a 5.39% yield c) 2 year corporate with a yield of 5.80% and Treasury with a 5.03% yield d) 5 year corporate with a yield of 5.32% and Treasury with a 4.48% yield e) 10 year corporate with a yield of 5.25% and Treasury with a 4.32% yield f) 20 year corporate with a yield of 5.28% and Treasury with a 4.35% yield 2. Find the prices for the Treasuries in problem 1 given the following coupon information. a) 2-year Treasury has a 4.75% coupon b) 5-year Treasury has a 4.13% coupon c) 10-year Treasury has a 3.88% coupon d) 20-year Treasury has a 4.05% coupon 3. For the Treasury instruments in question 2, a) Calculate the modified duration b) Calculate the convexity 4. For a 0.25% decrease in interest rates, what is the percentage change in the price of the instruments in question 2 ? a) Using the duration approximation b) Using the convexity approximation c) Calculate the actual percentage change in prices. 5. Given the bonds in question 2 (Treasuries only) and if you have a four-year investment horizon for $100,000, what bond portfolio would you create and why? Give portfolio weights in dollars amounts. Table 1 Cinirn 1 Cunmnla