Question 1. Find the 3-year/4-year forward rate from the following US Treasury bond prices and yields. Enter your answer as a percentage point to the nearest 3rd decimal (so 3.425% would be entered as 3.425).

1 year zero coupon bond with a 2.50% yield

2 year 2.00% coupon bond with a 3.00% yield

3 year 5.00% coupon bond with a 3.25% yield

4 year 3.00% coupon bond with a 3.50% yield

Question 2. A 5.375% semiannual coupon bond is trading at 102.388 (3.00% yield). Its modified duration is 7.965 and its convexity is 82.52. What is the estimated price (stated per 100 of par) if the yield decreases to 2.00%?