Bond #	1	2	3	4
	1-year strip bond	2-year strip bond	2-year 6% coupon bond	2-year 7% coupon bond
Purchase price ($xxxx.xx)	950.00
Time 1 cash flow	+1000.00	0	+60.00	+70.00
Time 2 cash flow	0	+1000.00	+1060.00	+1070.00
Yield to maturity (xx.xx%)			5.50%

1. What is the yield to maturity on Bond #1? (2 marks)
2. What is the price of Bond #3? (2 marks)
3. You are considering two investments from the bonds listed in the table.

Portfolio 1: 60 units of Bond #1 + 1060 units of Bond #2

Portfolio 2: 1000 units of Bond #3.

Show that the future cash flows from these two portfolios would be identical, in amount and timing. (2 marks)