12 percent bond, face value of $1,000 , life of 5 years. return required by the market is 10 percent coupon payments are made once annually.

Figure out price of bond at time of flotation on the market.

end of year three, the market requires a return of 8 percent instead of 10 percent find the market price at this time.

What is the yield of a two year zero coupon bond, when the market price is $970 and a face value of $1000.