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i need simple explain please 7) The zero rates for three, six, nine and twelve compounding. These rates suggest that the forwa continuous compounding. What

image text in transcribedi need simple explain please

7) The zero rates for three, six, nine and twelve compounding. These rates suggest that the forwa continuous compounding. What is the present va annum rate with quarterly compounding) for $1,000,000? e, Six, nine and twelve months are 8%, 8.2%, 8.4% and 8.5% with continuous Best that the forward rate between nine months and twelve months is 8.8% with Is the present value of an FRA that enables the holder to earn 9.4% (per very compounding) for a three month period starting in nine-months on a principal of 8) A three year bond with a yield of 6% (continuously compounded) pays a 10% coupon at the end of each year. Face value is $100 and bond price is 110.17. a) What is the bond's duration? b) Use duration to calculate the effect on the bond's price of a 0.1 % increase in its yield

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