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Consider the following US treasury rate table expressed in percentage. Maturity Yield Yesterday Last Week Last Month t R(0,t) 6 Month 2.65 2.35 1.85 1.55
Consider the following US treasury rate table expressed in percentage. Maturity Yield Yesterday Last Week Last Month t R(0,t) 6 Month 2.65 2.35 1.85 1.55 1 Year 2.75 2.70 2.20 1.90 2 Year 3.00 2.90 2.40 2.10 3 Year 4.75 4.65 4.15 3.85 5 Year 4.80 4.70 2.20 3.90 10 Year 5.00 4.90 4.40 4.10 30 Year 5.50 5.30 4.80 4.50 What is today the yield to maturity of a 3 year 5% coupon bond with annual payments? (Hint: Use the General Formula to find the price first, then compute the yield to maturity). 465
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