The Following Information Relates to Questions 16-29

Multiple Choice

The following information relates to Questions 16-29

-The one-year spot rate r(1) = 5% and the forward price for a one-year zero-coupon bond beginning in one year is 0.9346. The spot price of a two-year zero-coupon bond is closest to:

A) 0.87.
B) 0.89.
C) 0.93.