1. An investor buys a 20-year semiannual bond with a coupon rate of 5% for $950. He plans to hold the bond for 8 years and then sell it. The investor expects to reinvest the first 6 coupon payments at 4.5% and the next 10 payments at 5.5%. He also expects that the bonds YTM at the end of the holding period to be 6%. Under these assumptions, the total interest amount is

A. $420.63 B. $450.85 C. $474.51 D. $491.47 E. $512.36

2. An investor buys a 20-year semiannual bond with a coupon rate of 5% for $950. He plans to hold the bond for 8 years and then sell it. The investor expects to reinvest the first 6 coupon payments at 4.5% and the next 10 payments at 5.5%. He also expects that the bonds YTM at the end of the holding period to be 6%. Under these assumptions, the bond's price at the end of the holding period is

A. $898.35. B. $907.73 C. $915.32 D. $937.20 E. $957.35

3. An investor buys a bond for $975 with the intention to hold it for 6 years and then sell. He estimates the amount of the total future dollars for this investment as $1,508. This amount implies an annualized total return of

A. 7.4% B. 7.7% C. 8.2% D. 8.5% E. 8.8%