What are the implied forward rates in years

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Reference no: EM132611835

Maturity (Years) Price ($) 1 925.15 2 862.57 3 788.66 4 711.00

The following is a list of prices for zero-coupon bonds with different maturities and par values of $1,000.

You have purchased a 4-year maturity bond with a 9% coupon rate paid annually. The bond has a par value of $1,000.

a. What are the implied forward rates in years 2, 3, and 4?

b. What would the price of the bond be one year from now if the implied forward rates stay the same?

Reference no: EM132611835

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