4. Suppose the current zero-coupon yield curve for risk-free bonds is as follows: Maturity (years) YTM 1 3 4 5 3.25% 3.50% 3.90% 4.25% 4.40% The price per $100 face value of a three-year, zero-coupon, risk-free bond is closest to: A) $93.80 B) $90.06 C) $89.16 D) $86.39
4. Suppose the current zero-coupon yield curve for risk-free bonds is as follows: Maturity (years) YTM 1 3 4 5 3.25% 3.50% 3.90% 4.25% 4.40% The price per $100 face value of a three-year, zero-coupon, risk-free bond is closest to: A) $93.80 B) $90.06 C) $89.16 D) $86.39
Chapter5: The Cost Of Money (interest Rates)
Section: Chapter Questions
Problem 7PROB
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Transcribed Image Text:4. Suppose the current zero-coupon yield curve for risk-free bonds is as follows:
Maturity
(years)
YTM
1
3
4
3.25%
3.50%
3.90%
4.25%
4.40%
The price per $100 face value of a three-year, zero-coupon, risk-free bond is closest to:
A) $93.80
B) $90.06
C) $89.16
D) $86.39
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