Question
Download yield data for Oct 11, 2016 (latest data available for zerocoupon bond yields) from http://www.bankofcanada.ca/rates/interest-rates/bond-yield-curves/ (a) What are the specific yields in % for
Download yield data for Oct 11, 2016 (latest data available for zerocoupon bond yields) from http://www.bankofcanada.ca/rates/interest-rates/bond-yield-curves/
(a) What are the specific yields in % for 1, 2, 3, 5, 10, 20, 30 years. Sketch the yield curve. (Note: you should multiply the data by 100 to get them in %) Observe that the yield curve is essentially flat from years 20 to 30. Assume that the yield is flat over this period in answering the questions below.
(b) What upper bound for the expected short rates 20 to 29 years from now is implied by the Expectations Theory? Find the lowest upper bound and express it in percentages from one decimal point (e.g. for 21 n 30 ).
(c) The LPT implies what for the qualitative forecast for the expected short rates? The (real) yield on Real Return Bonds Long-term (for 20-30 years from now) is about 0.6% on Oct 11, 2016 (http://www.bankofcanada.ca/rates/interest-rates/canadian-bonds/) (d) What can you infer about the expected inflation rate in Canada long-term under the Expectations Theory?
| Date | 2016-10-11 |
| ZC025YR | 0.495380% |
| ZC050YR | 0.536100% |
| ZC075YR | 0.561640% |
| ZC100YR | 0.587190% |
| ZC125YR | 0.594990% |
| ZC150YR | 0.585300% |
| ZC175YR | 0.581720% |
| ZC200YR | 0.583620% |
| ZC225YR | 0.589980% |
| ZC250YR | 0.599820% |
| ZC275YR | 0.612270% |
| ZC300YR | 0.626680% |
| ZC325YR | 0.642510% |
| ZC350YR | 0.659410% |
| ZC375YR | 0.677110% |
| ZC400YR | 0.695450% |
| ZC425YR | 0.714340% |
| ZC450YR | 0.733720% |
| ZC475YR | 0.753590% |
| ZC500YR | 0.773960% |
| ZC525YR | 0.794850% |
| ZC550YR | 0.816310% |
| ZC575YR | 0.838350% |
| ZC600YR | 0.861000% |
| ZC625YR | 0.884280% |
| ZC650YR | 0.908200% |
| ZC675YR | 0.932750% |
| ZC700YR | 0.957940% |
| ZC725YR | 0.983720% |
| ZC750YR | 1.010080% |
| ZC775YR | 1.036970% |
| ZC800YR | 1.064340% |
| ZC825YR | 1.092140% |
| ZC850YR | 1.120310% |
| ZC875YR | 1.148790% |
| ZC900YR | 1.177500% |
| ZC925YR | 1.206370% |
| ZC950YR | 1.235340% |
| ZC975YR | 1.264330% |
| ZC1000YR | 1.293260% |
| ZC1025YR | 1.322080% |
| ZC1050YR | 1.350690% |
| ZC1075YR | 1.379050% |
| ZC1100YR | 1.407080% |
| ZC1125YR | 1.434730% |
| ZC1150YR | 1.461920% |
| ZC1175YR | 1.488620% |
| ZC1200YR | 1.514760% |
| ZC1225YR | 1.540310% |
| ZC1250YR | 1.565210% |
| ZC1275YR | 1.589440% |
| ZC1300YR | 1.612950% |
| ZC1325YR | 1.635720% |
| ZC1350YR | 1.657720% |
| ZC1375YR | 1.678920% |
| ZC1400YR | 1.699320% |
| ZC1425YR | 1.718900% |
| ZC1450YR | 1.737650% |
| ZC1475YR | 1.755560% |
| ZC1500YR | 1.772620% |
| ZC1525YR | 1.788850% |
| ZC1550YR | 1.804230% |
| ZC1575YR | 1.818780% |
| ZC1600YR | 1.832510% |
| ZC1625YR | 1.845430% |
| ZC1650YR | 1.857540% |
| ZC1675YR | 1.868880% |
| ZC1700YR | 1.879440% |
| ZC1725YR | 1.889250% |
| ZC1750YR | 1.898330% |
| ZC1775YR | 1.906710% |
| ZC1800YR | 1.914400% |
| ZC1825YR | 1.921420% |
| ZC1850YR | 1.927800% |
| ZC1875YR | 1.933570% |
| ZC1900YR | 1.938750% |
| ZC1925YR | 1.943360% |
| ZC1950YR | 1.947430% |
| ZC1975YR | 1.950990% |
| ZC2000YR | 1.954050% |
| ZC2025YR | 1.956650% |
| ZC2050YR | 1.958800% |
| ZC2075YR | 1.960540% |
| ZC2100YR | 1.961880% |
| ZC2125YR | 1.962850% |
| ZC2150YR | 1.963480% |
| ZC2175YR | 1.963770% |
| ZC2200YR | 1.963760% |
| ZC2225YR | 1.963470% |
| ZC2250YR | 1.962910% |
| ZC2275YR | 1.962110% |
| ZC2300YR | 1.961080% |
| ZC2325YR | 1.959830% |
| ZC2350YR | 1.958400% |
| ZC2375YR | 1.956790% |
| ZC2400YR | 1.955010% |
| ZC2425YR | 1.953100% |
| ZC2450YR | 1.951040% |
| ZC2475YR | 1.948870% |
| ZC2500YR | 1.946590% |
| ZC2525YR | 1.944210% |
| ZC2550YR | 1.941750% |
| ZC2575YR | 1.939210% |
| ZC2600YR | 1.936610% |
| ZC2625YR | 1.933950% |
| ZC2650YR | 1.931240% |
| ZC2675YR | 1.928500% |
| ZC2700YR | 1.925720% |
| ZC2725YR | 1.922910% |
| ZC2750YR | 1.920090% |
| ZC2775YR | 1.917250% |
| ZC2800YR | 1.914400% |
| ZC2825YR | 1.911550% |
| ZC2850YR | 1.908710% |
| ZC2875YR | 1.905860% |
| ZC2900YR | 1.903030% |
| ZC2925YR | 1.900210% |
| ZC2950YR | 1.897410% |
| ZC2975YR | 1.894630% |
| ZC3000YR | 1.891870% |
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Cost Accounting Principles And Applications
Authors: Horace R. Brock
5th Edition
0070081522, 978-0070081529
