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Q20 (4 pts) The yield-to-maturity of a one-year bond is 2% and the forward rate starting a year from now with a maturity of one
Q20 (4 pts) The yield-to-maturity of a one-year bond is 2% and the forward rate starting a year from now with a maturity of one year (i.e., the 1f1 ) is 4%. What is the price of a two-year zerocoupon bond that has a face value of $1000 ? Round your answer to the nearest dollar. A. $925 B. $943 C. $962 D. $980 E. $1,000 Q21 (4 pts) A two-year bond has annual coupons of 10.00% and a YTM of 10.00%. The oneyear spot rate is 5.00%. What is the two-year spot rate? A. 9.82% B. 10.00% C. 10.15% D. 10.26% E. 15.00%
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