1. Consider a zero-coupon bond with a $1,000 face value and 10 years left until maturity. If the YTM of this bond is 10.4%. What is the price of this bond?

2. A corporate bond with a face value of $1,000 and a coupon rate of 7.5% paid semi- annually, sells for $949.90. If the yield to maturity of similar bonds is 8.2%, how many years does this bond have until it matures? Round your final answer to the nearest year. (Hint: the yield is expressed as a rate per year compounded semi- annually)

3. Bond A has a bond yield of 6.8% (effective annual rate). Doodah Inc. is interested in issuing a consol with an annual coupon payment of 8%. What should be its current value if Doodah Inc. wants the new bond to have the same yield? Round your final answer to the nearest cent. (Hint: a consol is a bond paying coupons in perpetuity.)

4. Spot rates of interest for zero-coupon Government of Canada bonds are observed for different terms to maturity as follows:

a) What is the one-year forward rate in year 4?

b) What is the price of a risk-free bond with a face value of 1,000$, annual coupons of 50$, and maturity in 3 years?