Observe the yields of the treasury securities in the table below. All yields are shown on a bond equivalent basis. All the securities maturing from 1.5 years and up are selling at par. The 6 month and 1 year securities are zero-coupon instruments.

A.Calculate the missing spot rates.

B.What should be the price of a 6% six-year treasury security?

C.What is the six-month forward rate starting in the 6th year?

Year	Yield to Maturity (%)	Spot rate (%)
0.5	5.25	5.25
1.0	5.50	5.50
1.5	5.75	5.76
2.0	6.00	A
2.5	6.25	B
3.0	6.50	C
3.5	6.75	D
4.0	7.00	E
4.5	7.25	F
5.0	7.50	G
5.5	7.75	7.97
6.0	8.00	8.27
6.5	8.25	8.59
7.0	8.50	8.92
7.5	8.75	9.25
8.0	9.00	9.61
8.5	9.25	9.97
9.0	9.50	10.36
9.5	9.75	10.77
10.0	10.00	11.20