18. Bond valuation. If a $1,000 zero coupon bond with a 10-years maturity has a market price of $508.30, what is the rate of return?

19. Bond valuation. A tax-exempt bond was recently issues at an annual 10 percent coupon rate and mature 15 years from today. The par value of the bond is 1,000.

A.If required market are 10 percent, what is the market price bond?

B.If required market are 5 percent, what is the market price bond?

C.If required market rate rise to 14 percent, what is the market price bond?

D.At what required market rate (10 percent, 5 percent, or 14 percent) does the above bond sell at a discount? At a premium?

20. Bond valuation. A tax-exempt bond was recently issued at an annual 8 percent coupon rate and mature 20 years from today. The par value of the bond is $5,000.

A. If required market rates are 8 percent, what is the market price of the bond?

B. If required market rates fall 4 percent, what is the market price of the bond?

C. If required market rates rise 12 percent, what is the market price of the bond?

D. At what required market rate (8 percent, 4 percent, or 12 percent) does the above bond sell at a discount? At a premium?