Zero-Coupon Bond Prices Are Given by B(0,T ),Where 0 Is

question 5

Multiple Choice

Zero-coupon bond prices are given by B(0,T ) ,where 0 is today,and T (measured in years) is the bond's maturity date.
-Suppose that you compute the simple forward rate over the time period that begins after one year and continues over the next day,and use it as an approximation to the continuously compounded forward rate.Then the value that you obtain is:

• A) 0.041667
• B) 0.043478
• C) 0.042588
• D) 0.042553
• E) None of these answers are correct.

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