Consider the following par bond (ie coupon rate-yield): Maturity: 12345 VTM: 4.5%;4.0%;3.75%;3.5%;3.375% Q1a. Calculate discount factor for all 5 years ( 5 points) Q1b.Calculate spot rates for all 5 years Q1c.Calculate forward rates for all 5 years ( 5 points) Q1d. Price a 5 year 10% coupon bond. What is the YTM for the bond (10 points). Q1e. You manage 100 million dollar floating rate loan that is indexed to one year spot rate plus 2.5% spread (margin). You want to convert it to a 5-year fixed rate loan using a swap contract with notional value of 100 million. What is the breakeven five year fixed rate? (5 points). Q2. Five Year rate zero is currently trading at 4% yield and 20 year zero trading at 3.5% rate. Q2a. What is the duration 5y and 20y bond respectively ( 5 points)? Q2b. If you short 10 million of 20Y bond, how many dollars of long position do you need to take in the 5Y in order to offset the dollar duration risk? ( 5 points)