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Use the following information on zero-coupon bonds for the question: Maturity 1 2 3 4 5 Price (per $100 face value) 94.52 89.68 85.40 81.65
Use the following information on zero-coupon bonds for the question:
Maturity | 1 | 2 | 3 | 4 | 5 |
Price (per $100 face value) | 94.52 | 89.68 | 85.40 | 81.65 | 78.35 |
YTM | 5.8 | 5.6 | 5.4 | 5.2 | 5.0 |
If you plot the zero-coupon yield curve for the first five years, what would the slope look like? What does it mean? Be brief.
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