Suppose that risk-free spot rates with continuous compounding are as follows: Maturity (Months) Spot Rate (% per annum) 3 2.5 6 2.7 9 2.8 12 3.0 15 18 3.2 3.3 1. Calculate forward interest rates for the second, third, fourth, fifth and sixth quarters. Below is the table of future cashflows paid out by the bond, along with the spot rates that are continuously compounded: Maturity (Years) Spot Rate Coupon Payment Principal 0.5 1.80% 30 1 2.05% 30 1.5 2.15% 30 2 2.4% 30 1000 2. What is the bond's theoretical price? 3. What is the yield of the bond assuming it sells for its theoretical price? 4. Convert a 5% per annum interest rate with quarterly compounding to the equivalent rate with annual compounding. 5. Convert a 4% per annum interest rate with semi-annual compounding to the equivalent rate with monthly compounding. 6. Convert a 4.5% per annum interest rate with monthly compounding to the equivalent rate with continuous compounding.