Assume you have a one-year investment horizon and are trying to choose among three bonds. All have the same degree of default risk and mature in 8 years. The first is a zero-coupon bond that pays $1,000 at maturity. The second has an 8.2% coupon rate and pays the $82 coupon once per year. The third has a 10.2% coupon rate and pays the $102 coupon once per year. Assume that all bonds are compounded annually.

a. If all three bonds are now priced to yield 8.2% to maturity, what are their prices? (Do not round intermediate calculations. Round your answers to 2 decimal places.)

	Zero	8.2% Coupon	10.2% Coupon
Current prices	$________	$______	$_______

b-1. If you expect their yields to maturity to be 8.2% at the beginning of next year, what will their prices be then? (Do not round intermediate calculations. Round your answers to 2 decimal places.)

	Zero	8.2% Coupon	10.2% Coupon
Prices one year from now	$_______	$_______	$______

b-2. What is your rate of return on each bond during the one-year holding period? (Do not round intermediate calculations. Round your answers to 2 decimal places.)

	Zero	8.2% Coupon	10.2% Coupon
Rate of return	______%	_______%	_______%