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Use the following information on government bond yields for Questions 1-5. Rate 4% Time Period Oyly Oy2y Oy3y 5% 6% 7% 8% Oy5y 1. What
Use the following information on government bond yields for Questions 1-5. Rate 4% Time Period "Oyly" "Oy2y" "Oy3y" 5% 6% 7% 8% "Oy5y 1. What is the 2y2y implied forward rate? 2. What is the 3yly implied forward rate? 3. What is the ly4y implied forward rate? 4. You are considering the purchase of a government bond that will pay you $1000 in exactly 5 years. Given the rates in the table above, what do you expect the bond's value to be in exactly 1 year? 5. Consider the same bond as described in Question =4. What do you expect the price of the bond to be in exactly 4 years
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