Assume Sophia wants to earn a return of 5% and is offered the opportunity to purchase a $1000.00 par value bond that pays a 5% coupon rate (distributed semiannually) with three years remaining to maturity. The following formula can be used to compute the bonds intrinsic value:

Intrinsic value = [A/(1=C)^1]+[A/(1=C)^2]+ [A/(1=C)^3]+[A/(1=C)^4]+ [A/(1=C)^5]+[A/(1=C)^6]+ [B/(1=C)^6]

a. Complete the following table by identifying the appropriate corresponding variables used in the equation.

Unknown	Variable name	variable value
A	?	?
B	?	$1,000
C	Semiannual required return	?

b. Based on this equation and data, is it reasonable to expect that Sophias potential bond investment is currently exhibiting an intrinsic value equal to $1000?

c. Consider the situation in which Sophia wants to earn a return of 3%, but the bond being considered for purchase offers a coupon rate of 5%. Again, assume that the bond pays semiannual interest payments and has three years to maturity. If you round the bonds intrinsic value to the nearest whole dollar, then its intrinsic value of __________ is ____________ its par value, so that the bond is ___________________.