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1. You buy a zero-coupon bond which will pay you $1000 in 30 years. Annual discount rate is i = 6% compounded once per year.

1. You buy a zero-coupon bond which will pay you $1000 in 30 years. Annual discount rate is i = 6% compounded once per year. A few minutes later the discount rate rises to i = 7%. What is the percent change in the value of the bond? Hint: if an answer is negative, do not drop the minus sign. 2. You buy a zero coupon bond which will pay you $1000 in 30 years. Annual discount rate is i = 14% compounded once per year. What will be the price of this bond 25 years later? Suppose the discount rate stays the same

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