You are provided with information about the yield curves of treasury securities as follows: Maturity (years) 1 On-the-run yield curve 2.50% 2.99% 3.48% 3.95% 4.37% Pure yield curve 2.50% 3% 3.50% 4% 2 3 4 5 The on the run yled curve is plotted using the yields of coupon bonds paying annual coupons, which are recently issued and traded at par. The pure yield curve is plotted using the yields of zero coupon bonds. From the yields information above, the year rate of zero-coupon treasury bonds is (choose the closest answer) 4.59 QUESTION 20 You are provided with information about the yield curves of treasury Securities as follows Maturity On-the-run yield Pure yield (years) curve curve 1 2.50% 2.50% 2 2.99% 3% 3 3.48% 3.50% 4 3.95% 4% 5 4.37% The on the run yield cure is plotted using the yields of coupon bonds paytre sal coupers, which are recently issued and traded separ. The pure yteld curve is plotted using the yields of sero coupon bonds Using the yiekis information above which of the forward rates can be calculated al-year loan beginning in five years year to beginning in three years 4-year loan beginning in one year year loan beginning in four year QUESTION 19 You are provided with information about the yield curves of treasury securities as follows: Maturity On-the-run yield Pure yield (years) curve curve 1 2.50% 2.50% 2 2.99% 3% 3 3.48% 3.50% 4 3.95% 4% 5 4.37% The on the run yield curves plotted using the yields of coupon bonds paying annual coupons which are recently issued and traded at par. The pureyield cure is pleted using the yields of zero coupon bonds You observe that a 5 treasury bond paying annual coupons with a par value of 51000 and 4 years to maturity is currently traded at the price of $1033. Based on the yieds information in the exhibit you conclude that this coupon saying bond is undervalued priced overvalued lack of sufficient information to make a conclusion