hould be answered by building an n=

n

=10-period binomial model for

the short-rate, ri,j

ri

,

j

. The lattice parameters are: r0,0=5%

r

0,0

=5%, u=1.1

u

=1.1, d=0.9

d

=0.9 and q=1q=1/2

q

=1

q

=1/2

t=10 and face value is 100$

Compute the price of a forward contract on the same ZCB of the previous

question where the forward contract matures at time t=4 and futures contract on the same ZCB,has an expiration of t=4. ?