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Question 1: Suppose that you have the following bonds (1 year; 2 year; 3 year; 4 year; and 5 year maturity) with the corresponding interest

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Question 1: Suppose that you have the following bonds (1 year; 2 year; 3 year; 4 year; and 5 year maturity) with the corresponding interest rates in column 2: Maturity (Years) Spot rate Forward rate Expected future single year spot rate 1 8.00 2 8.75 3 9.33 4 9.79 5 10.13 Plot the yield curve based on these spot rates. Compute the forward rate and the expected future single period spot rate based on the expectations theory Question 1: Suppose that you have the following bonds (1 year; 2 year; 3 year; 4 year; and 5 year maturity) with the corresponding interest rates in column 2: Maturity (Years) Spot rate Forward rate Expected future single year spot rate 1 8.00 2 8.75 3 9.33 4 9.79 5 10.13 Plot the yield curve based on these spot rates. Compute the forward rate and the expected future single period spot rate based on the expectations theory

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