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Intro Treasury spot interest rates are as follows: Maturity (years) 1 2 3 4 Spot rate (EAR) 2.5% 2.8% 3.5% 4.5% Part 1 What is

Intro

Treasury spot interest rates are as follows:

Maturity (years) 1 2 3 4
Spot rate (EAR) 2.5% 2.8% 3.5% 4.5%

Part 1

What is the price of a risk-free zero-coupon bond with 3 years to maturity and a face value of $1,000 (in $)?

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