A bond with 9 years to maturity and a coupon rate of 7.5% has a par, or face, value of $1,000. Interest is paid semi-annually.

1. If you required a return of 6% on this bond, what is the value of this bond to you? (3 points)
2. Compare the basic characteristics of Eurobonds and Local bonds. (2 Points)
3. If the required return on a bond differs from its coupon interest rate, describe the behavior of the bond value over time as the bond moves toward maturity. (3 Ponts)