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a) Discuss why the money market is important and identify three characteristics that define it. b) A bond is issued at Face Value of $1,000

a) Discuss why the money market is important and identify three characteristics that define it.

b) A bond is issued at Face Value of $1,000 and pays a 4% coupon annually with a term to maturity of 10 years. The market interest rate is 5%. What is the price of this bond today and is the bond trade at a discount, premium or par?

c) A bond is issued at Face Value of $10,000 and pays a 4% coupon semi-annually with a term to maturity of 10 years. The market interest rate is 3%. What is the price of this bond today and is the bond trade at a discount, premium or par?

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