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The following table shows the prices of a sample of Treasury bonds, all of which have coupon rates of zero. Each bond makes a single
The following table shows the prices of a sample of Treasury bonds, all of which have coupon rates of zero. Each bond makes a single payment at maturity. a. What is the 1-year interest rate? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. b. What is the 2-year interest rate? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. c. What is the 3-year interest rate? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. d. What is the 4-year interest rate? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. e. Is the yield curve upward-sloping, downward-sloping, or flat? f. Is this the usual shape of the yield curve
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