1.) Use the graph to answer the following questions. (20pts) * Assume this is a 1 year bond. Bond Price Discount Bond Market BS 875 BD Quantity Bonds a. As the bond price rises, what do you expect to happen to the yield-to-maturity (increase or decrease). Fully explain why this is the case. b. If the face value of the bond is $1,100, what is the yield-to-maturity at a bond price of $875? bond pri c. Illustrate the effects of an economic recession in the above bond market by showing the shifts of the BS and BD curves. d. Explain why those shifts occurred and what the outcome of the shifts will be. 1.) Use the graph to answer the following questions. (20pts) *Assume this is a 1 year bond. Bond Price Discount Bond Market BS 875 BO Quantay Bonds a. As the bond price rises, what do you expect to happen to the yield-to-maturity increase or decrease). Fully explain why this is the case. bthe face value of the bond is $1,100, what is the yield to maturity at a bond price of $8757 c. lllustrate the effects of an economic recession in the above bond market by showing the shifts of the BS and BD curves. d. Explain why those shifts occurred and what the outcome of the shifts will be