Maturity	Discount Factor
6 months	0.9915
1 year	0.9800
1 and 1/2 years	0.9675
2 years	0.9500

1. Consider a 4% treasury note, which matures in one year. Interests are paid semiannually. Of this bond is selling at par, what would be your arbitrage strategy?

2. Suppose that a 2% coupon Treasury note maturing in 2 and half years is selling for $98.50. What is the zero curve and equivalently, the discount factor for the 2 and half years.