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G I A E F H Suppose we observe the following rates: 2 3 TRI 0.91% 4 E(201) 3.30% 5 E(3rl) 3.94% 6 E(41) 5.13%

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G I A E F H Suppose we observe the following rates: 2 3 TRI 0.91% 4 E(201) 3.30% 5 E(3rl) 3.94% 6 E(41) 5.13% 7 E(5r1) 5.63% 8 Erl) 6.46% 9 10 a) If the unbiased expectation theory of term structure of interest rates holds, Compute the following rates: 11 IRI 0.91% 12 1R2 13 1R3 14 1R4 15 1R5 16 TR6 17 18 b) Graph the Yield Curve 19 20 21 22 23 24 C) Comment on the graph 25 26 27 28 29 G I A E F H Suppose we observe the following rates: 2 3 TRI 0.91% 4 E(201) 3.30% 5 E(3rl) 3.94% 6 E(41) 5.13% 7 E(5r1) 5.63% 8 Erl) 6.46% 9 10 a) If the unbiased expectation theory of term structure of interest rates holds, Compute the following rates: 11 IRI 0.91% 12 1R2 13 1R3 14 1R4 15 1R5 16 TR6 17 18 b) Graph the Yield Curve 19 20 21 22 23 24 C) Comment on the graph 25 26 27 28 29

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