1.a. Calculate the price and duration for the following bond when the going rate of interest is 8%. The bond offers 7.5% coupon rate, matures in 3 years and has a par value of $1,000. Show full calculations and fill the table below.

YR	PV of $ 1	Bond Cash Flows	PV (Cash Flows)	Year * Present Value of Cash Flow
1
2
3
3
Total

Price= __________

Duration=____________

b. What would be the new price if the market rate of interest rises to 9%? Show by using the duration only and show all calculations.

c. What would be the new price if the market rate is 7.5 %?