Practice Problem Due date: You are the loan officer of bank Y and one of your prime (zero default risk) customers is asking you for a $ 100 million 2 year maturity loan with annual interest payments. The effective annual prime rate is currently at 7% p.a. In order to price the loan realistically (without assuming a flat yield curve), you price the loan using Treasury (T-bills and T-notes) public market information to gather the consensus yield curve. After checking with your money-market broker you find that, The current market price of the 1-year T-Bill is 95.0000, The current market price of the 2-year, 8% coupon T-Note is 102.0000 (the coupon is expressed as an effective annual rate payable once per year) Make a graph of the yield curve up to 2 years Assuming a zero default risk. What is the price of the commercial loan in % terms