Table summarizes yields to maturity on several?

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The following table summarizes yields to maturity on several? 1-year, zero-coupon? securities:

Security

Yield

Treasury

2.820

2.820?%

AAA Corporate

2.837

2.837?%

BBB Corporate

3.093

3.093?%

B Corporate

3.644

3.644?%

a. What is the price? (expressed as a percentage of the face? value) of a? 1-year, zero-coupon corporate bond with a? AAA-rating and a face value of $1,000??

b. What is the credit spread on? AAA-rated corporate? bonds?  

c. What is the credit spread on? B-rated corporate? bonds?

d. How does the credit spread change with the bond? rating? Why?

?Note: Assume annual compounding.

Reference no: EM132538564

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