Answer the following questions about fixed-income securities.

1. A Treasury bill with a par value of $100,000 due three months from today is selling for $96,545. What

is its effective annual yield?

2. You buy a $1000 par value 30-year zero-coupon bond issued at a yield to maturity of 12%. After one

year, the prevailing interest rate has fallen to 10%. How much money do you make if you sell the bond

after this year?

3. A coupon bond pays interest twice per year, has a par value of $1200, will mature in 10 years, and has

an annual coupon rate of 10%. It's current yield to maturity is quoted at 15%. What is the price of

this bond?