BOND VALUATION

Please show the explanation and solution. Thank you so much....

1.Doja Lipa issues a P1,000 corporate bond with an annual interest rate of P6%, quarterly interest payments for 3 years. The bond's yield to maturity is 12%.

a.What is the present value of the coupon payments?

b.What is the present value of the face value of the bond?

c.What is the price of the bond?

2.Karim Mabait issues a P1,000 corporate bond with an annual interest rate of P5%, making semi-annual interest payments for 2 years. The bond's yield to maturity is 3%.

a.What is the present value of the coupon payments?

b.What is the present value of the face value of the bond?

c.What is the price of the bond?

3.Given below are information for an existing bond that provides annual coupon payments:

• Par value of P1,000;
• The coupon rate of 11%; Maturity of four (4) years; and
• The required rate of return by investors is 11%.

a.What is the present value of the bond?

b.If the required rate of return by investors were 14 % instead of 11%, what would be the present value of the bond?