SHOW EXCEL CELLS

Spot Curve Year Spot Rate Disc Factor 1 2 3 4 5 T Bond 99.50000 100 PAR SEMI ANNUAL 0.99 Hint: Calculate the 1-year spot rate first, then the discount factor. For all others, calculate the discount factor first, then the spot rate. This is the same method we learned in class and is laid out in your notes and book. Note: assume the 1-year yield on the yield curve = spot rate for 1-year. 1-year bond is typically a zero coupon Treasury bond and therefore = spot. For all other bonds (2y +) assume this is a multi-period, coupon paying bond. Spot Curve Year Spot Rate Disc Factor 1 2 3 4 5 T Bond 99.50000 100 PAR SEMI ANNUAL 0.99 Hint: Calculate the 1-year spot rate first, then the discount factor. For all others, calculate the discount factor first, then the spot rate. This is the same method we learned in class and is laid out in your notes and book. Note: assume the 1-year yield on the yield curve = spot rate for 1-year. 1-year bond is typically a zero coupon Treasury bond and therefore = spot. For all other bonds (2y +) assume this is a multi-period, coupon paying bond