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-The current zero-coupon yield curve for risk-free bonds is shown above. What is the price per $100face value of a four-year, zero-coupon, risk-free bond?

Question

Use the figure for the question(s) below

-The current zero-coupon yield curve for risk-free bonds is shown above. What is the price per $100face value of a four-year, zero-coupon, risk-free bond?

Quizplus · Accepted Answer

The price of a zero-coupon bond is calculated using the formula: Price = Face Value / (1 + yield)^n. Assuming the yield for a four-year bond is given by the yield curve, you would plug in the appropriate yield and n=4 to find the price.

Use the Figure for the Question(s) Below