Describe differences in interest rate risk between bonds with embedded calls and puts and otherwise identical bonds without embedded options.

Describe three reasons why using the yield curve as a macro forecasting tool may be problematic.

What is the consequence of the additional interest rate risk faced by investors who hold a callable bond relative to an otherwise identical non callable bond?

Describe in detail the construction of the zero-coupon discount curve, starting with the empirical on-the-run Treasury curve. a. Why is it necessary to obtain zero-coupon discount rates from the empirical curve?