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A bond with a Face Value of $1,000 that carries an 5.5% coupon and will mature in 7 years. The Investor has a required return

A bond with a Face Value of $1,000 that carries an 5.5% coupon and will mature in 7 years. The Investor has a required return of 12%.

1. What Price is the Investor willing to pay for the Bond?

2. What would the Price be if the bond were a zero-coupon band?

3. What would the price be if the bond matured in 4 years?

4. What would happen if the price of the Federal Funds Rate goes up?

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