Bond	Coupon Rate	Maturity Year	Par Value
1	7.5%	2032	1000
2	8.25%	2029	1000
3	6.0%	2023	1000

a.) Assuming that bonds pay annual coupon, estimate the market value of each bond at a discount rate of 7.4%

b.) Assuming that bonds pay annual coupon, what will happen to the price of each bond if market rates suddenly decrease from 7.4% to 6.2%? Which of the three bonds will have the greatest percentage change in price?

c.) Assuming that bonds pay annual coupon, what will happen to the price of each bond if market interest rates suddenly increase from 7.4% to 8.6%? Which of the three bonds will have the greatest percentage change in price?

d.) Assuming that bonds pay annual coupon. Also, the bonds are currently trading in the market at $973.63, $932.37, and $1,075.58 respectively. What is the yield-to-maturity of each bond?

e.) Assuming that bonds pay annual coupon. Suppose Rhea purchased bond 1 today at a price of $973.63, but would like to sell the bond in 7 years at which time similar bonds yield 6.753%. At what price can Rhea expect to sell the bonds? If she sells the bond in 7 years at the price computed, what would be her realized rate of return over her holding period?

f.) Repeat analysis in parts a)-e) assuming bonds pay semi-annual coupon.