1. How is bond's value determined? What is the value of a 10-year, $1000 par value bond with a 10% annual coupon if its required return is 10%?

2. A) what is the value of a 13% coupon bond that is otherwise identical to the bond described in Question 1? Would we now have a discount or a premium bond?

B) what is the value of a 7% coupon bond with these characteristics? Would we now have a discount or premium bond?

C) what would happen to the values of the 7%, 10% and 13% coupon bonds over time if the required return remained at 10%?