Question
The schedule of 1-year forward rate across next 5 years is as follows. Year 1-year Forward Rate 1 4.6% 2 4.9% 3 5.2% 4 5.5%
The schedule of 1-year forward rate across next 5 years is as follows.
| Year | 1-year Forward Rate |
| 1 | 4.6% |
| 2 | 4.9% |
| 3 | 5.2% |
| 4 | 5.5% |
| 5 | 5.8% |
What should the purchase price of a 4-year zero-coupon bond be if it is purchased today and has face value of $1,000?
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Real Life Money An Honest Guide To Taking Control Of Your Finances
Authors: Clare Seal
1st Edition
1472272293, 978-1472272294
