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This morning you agreed to buy a one-year Treasury bond in six months. The bond has a face value of $1,000. Use the spot interest
This morning you agreed to buy a one-year Treasury bond in six months. The bond has a face value of $1,000. Use the spot interest rates listed here to answer the following questions Time 6 month:s 12 months 18 months 24 months EAR 372% 4.16 4.84 5.56 a. What is the forward price of this contract? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Forward price b. Suppose shortly after you purchased the forward contract all rates increased by 30 basis points. For example, the six-month rate increased from 3.72 percent to 4.02 percent. What is the price of a forward contract otherwise identical to yours given these changes? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Forward price
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