Introduction to Investment Assignment 1

Chapter 4

4.8

The calculated zero rates are:

-The six-month rate is 12.38%

-The year rate is 11.65%

-The 1.5-year rate is 11.50%

-The 2-year rate is 11.30%

4.10

The interest paid quarterly will be in a payment of $304.50.

4.15

The forward LIBOR rate for the third year is 4,474.69.