1.) There is a two year risk free discount (zero coupon) bond with $1,000 par value. This is a security that promises a single risk-free payment of $1,000 in two years length of time.

A.) If the risk-free rate is 4%, what we can conclude about the price of this in a normal market?

B.) Is arbitrage possible, if the price of the bond is $920. If yes, show the action taken to perform an arbitrage strategy? In addition, State the arbitrage profit.