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a. Here are the prices of three bonds with 10-year maturities: Bond Coupon (%) 2 Price % 81.62 98.39 133.42 00- If coupons are paid
a. Here are the prices of three bonds with 10-year maturities: Bond Coupon (%) 2 Price % 81.62 98.39 133.42 00- If coupons are paid annually, which bond offered the highest yield to maturity? Which bond offered the lowest yield to maturity? (5 marks) b. A 10-year U.S. Treasury bond with a face value of $10,000 pays a coupon of 5.5%, (2.75% of face value every six months). The semiannually compounded interest rate is 5.2% (a six-month discount rate of 5.2/2 = 2.6%). What is the present value of the bond? (5 marks) c. Generate a graph or table showing how the bond in b) above sees its present value change for semiannually, compounded interest rates between 1% and 15%
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