What is the price of the six-month bond

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The six-month zero rate is 8% per annum with semiannual compounding. The price of a oneyear bond that provides a coupon of 6% per annum semiannually is $97. The face value for each bond is $100.

a. What are the six-month and one-year continuously compounded zero rates?

b. What are the continuously compounded forward rates for the periods (1) starting today for six-months, and (2) six-months to 12-months?

c. Extra Credit (+5): What is the price of the six-month bond?

Reference no: EM132818080

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