Suppose that discount bond prices are as follows: t 1 2 3…

Suppose that discount bond prices are as follows: t 1 2 3 4 Pt 0.9525 [p2] [p3] [p4] r0,t 0.05 [r2] [r3] [r4]       A customer would like to have a forward contract to borrow $20M two years from now for one year. Can you (a bank) quote a rate for this forward loan?  

You have been offered a job with an unusual bonus structure….

You have been offered a job with an unusual bonus structure. As long as you stay with the firm, you will get an extra $[c] every seven years, starting seven years from now. What is the present value of this incentive if you plan to work for the company for 42 years and the interest rate is [r]% EAR?