Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Please do it in excel and show the formuls

The following table contains data to calculate forward rates using pure expectations theory.
a) Find the yield on a 8 year bond, 2 years forward (2rs).
b) Find the yield on a 6 year bond, 3 years forward (3r6).
Maturity
Yield
1 year
2.00%
2 years
3 years
4 years
5 years
2.20%
3.40%
4.50%
5.00%
6 year
7 years
8 years
9 years
10 years
5.00%
5.20%
5.40%
5.50%
5.50%
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Transcribed Image Text:The following table contains data to calculate forward rates using pure expectations theory. a) Find the yield on a 8 year bond, 2 years forward (2rs). b) Find the yield on a 6 year bond, 3 years forward (3r6). Maturity Yield 1 year 2.00% 2 years 3 years 4 years 5 years 2.20% 3.40% 4.50% 5.00% 6 year 7 years 8 years 9 years 10 years 5.00% 5.20% 5.40% 5.50% 5.50%
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