1 Cheetah is an automobile company which has been one of the most competitive firms in this industry for more than fifty years. However, these days, it is facing the rapidly changing market situation, especially the development of electric cars to reduce carbon emission. Hence, the executives at Cheetah decided to develop electric cars in order to stay ahead of competition in the market. In order to finance for the new project on electric cars, it needs to issue corporate bonds. Suppose Cheetah issued a corporate bond with 3 years to maturity, a face value of $1,500, and an annual coupon rate of 5.0% which is paid on annual basis. This bond is selling for $1300 in the market. What is its yield to maturity? b. If the yield to maturity changes to 6.0%, what will be the new price of the bond? c. Cheetah issued a new 5-year bond, with a face value of $2,000, and a coupon rate of 2.5% (coupon is paid semi-annually). If this bond has current yield of 2.7%, is it sold at a discount or at a premium? d. Determine the yield to maturity of this bond. 9