The price of a 1-year zero is 9600 the price of a 2-year 10


a) The price of a 1-year zero is $96.00, the price of a 2-year 10% coupon bond is $107.30 and the price of a 3-year 8% coupon bond is $102.25. Use the bootstrap method to calculate all zero rates.

b) Given the bonds in a, what is the price of a 3 year 5% coupon bond? What is its yield?

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Financial Management: The price of a 1-year zero is 9600 the price of a 2-year 10
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