The following is a Black-Derman-Toy tree model for interest rates with each period being four months: -0.0272 0.0215 -0.0197 -0.0229 0.018 0.0188 -0.0173 M -0.0192 0.0165 0.0161 (i) ( Construct a binomial tree of four-month zero-coupon bond prices. State the appropriate formula to be used. (ii) Calculate the price of an eight-month forward on an eight-month zero-coupon bond. (iii) A European call option allows the purchase of a four-month zero-coupon bond at the end of four months for 0.8. Determine the price to be paid if 20 of this option was bought. The following is a Black-Derman-Toy tree model for interest rates with each period being four months: -0.0272 0.0215 -0.0197 -0.0229 0.018 0.0188 -0.0173 M -0.0192 0.0165 0.0161 (i) ( Construct a binomial tree of four-month zero-coupon bond prices. State the appropriate formula to be used. (ii) Calculate the price of an eight-month forward on an eight-month zero-coupon bond. (iii) A European call option allows the purchase of a four-month zero-coupon bond at the end of four months for 0.8. Determine the price to be paid if 20 of this option was bought