$(8$ points$)$ You're browsing through the paper over your morning cup of coffee, and as usual you turn to the credit markets page to see what's up with interest rates. You find the following yield curve for pure$-$discount $($zero$-$coupon$)$ bonds. In the next column, you see the table showing characteristics of two annual pay bonds from the same issuer, with the same priority in the event of default, and the same credit rating as bonds used to construct the yield curve. For this question, assume that bonds make only one coupon payment per year, and that all yields are quoted as annually compounded $($i$.$e$.,$'not semi$-$annually compounded$)$ rates.

Zero Coupon Yield Curve

$\backslash$table$[[$Bond$,$Napoleon,Snowball$],[$Coupons$,$Annual,Annual$],[$Maturity$,3$ years,$3$ years$],[$Coupon Rate,$8\%,5\%$