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4. An investor has two bonds in her portfolio. Bond C and Bond Z. Each bond matures in 4 years, has a face value of

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4. An investor has two bonds in her portfolio. Bond C and Bond Z. Each bond matures in 4 years, has a face value of $1,000, and has a yield to maturity of 9.6%.Bond C pays a 10% annual coupon, while Bond Z is a zero coupon bond a. Assuming that the yield to maturity of each bond remains at 9.6% over the next 3years, calculate the price of the bonds at each of the following years to maturity: (4 marks) Years to Maturity Price of Bond Price of Bond Z 1 2 3 4 6. Plot the time path of prices for each bond. (2 marks)

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