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yield curve year Yield ( % ) 0 . 5 3 . 4 5 % 1 3 . 6 5 0 0 % 1 .

yield curve
year Yield(%)
0.53.45%
13.6500%
1.53.8500%
24.0500%
2.54.2500%
34.4500%
3.54.6500%
44.8500%
4.55.0500%
55.2500%
65.4500%
Part a
Calculate the price of 3.4% semi-annual coupon paying bond with maturity of 4 years. Assume par value is 100.
Part b
Calculate the price of 0% semi-annual coupon paying bond with maturity of 4 years. Assume par value is 100.
Part c
If the entire yield curve increases by 1%, what is the percentage price change of 3.4% coupon paying bond?
Part d
If the entire yield curve increases by 1%, what is the percentage price change of 0% coupon paying bond.
Part e
Which bond reacts more to the change in yield, and why?
Zero coupon bond reacts more because the cash flows arrive at the end and teher is no gain from the coupon reinvestment.
Use FINRA for todays data and numbers. Please upload excel functions, I have attached the problem
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