3. Valuing Bonds (20 points) a- What is the price of a 10year, pure discount bond paying $1,000 at maturity if the YTM is 10 percent? b. At the end of year 5, with 5 more years to maturity, the investor could sell the above bond for its market value at the end of year 5 and buy a 5-year, 1 percent coupon bond at the same price (as the market value of the bond he is selling). Assume the market interest rate is still 10 percent. What should the investor do