The prices of a number of $1,000 (face value) zero-coupon bonds are provided in the Table,below.Compute the yields on the zero coupon bonds.Plot the yield curve.What is the shape of the yield curve?

Question

The prices of a number of $1,000 (face value)zero-coupon bonds are provided in the Table,below.Compute the yields on the zero coupon bonds.Plot the yield curve.What is the shape of the yield curve?

Quizplus · Accepted Answer

k = 11ea7fdb_fbfb_7f6a_a768_ff7de3498674_TB2902_11 - 1 k₁ = 11ea7fdb_fbfb_7f6b_a768_15b391b0eb6c_TB2902_11 - 1 = 3.59% k₂ = 11ea7fdb_fbfb_7f6c_a768_6b522bc7d749_TB2902_11 - 1 = 4.07% k₃ = 11ea7fdb_fbfb_7f6d_a768_2f3946f827ae_TB2902_11 - 1 = 4.15% k₄ = 11ea7fdb_fbfb_7f6e_a768_4de17fdd8c6e_TB2902_11 - 1 = 5.02% The yield curve is upward sloping.

The Prices of a Number of $1,000 (Face Value)zero-Coupon Bonds