Suppose you observe the following zero-coupon bond prices per $1 of maturity payment as given in the table below The value of d is closest to ZCB Maturiy Price 1 23 3 4 n ZCB Yield 0.96386 0.03750 0.92234 0.88262 0.04250 b 0.83058 0.77426 0.05250 1-Year Implied Forward Rate 0.03750 0.04501 с 0.06264 0.07274 Continuously Par Compounded Coupon Rate Zero Yield 0.03750 0.04117 0.04240 d 0.05161 0.03681 0.04042 e 0.04641 0.05117

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Treasury Market

On-the-run securities are the most recently issued securities in the market depth and are therefore traded at some premium. The off-the-run securities are the ones issued just before the most recent ones. The on-the-run securities have a lower yield to the investor than the off-the-run securities.