Discount Function LO 22.1 ( (3)
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Years to Maturity
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0.25
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0.5
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1.0
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Bond price ($100 par)
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$98.98
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$97.89
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$95.60
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Discount function
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0.9898
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0.9789
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0.9560
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Spot rates
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4.15%
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4.30%
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4.55%
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2.15%
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2.28%
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Forward rate (0.5f0.5)
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4.80%
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Check for accuracy
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Roll-over to forward
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4.60%
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Hold the Spot
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4.60%
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