Bond value and changing required returns Midland Utilities has outstanding a bond issue that will mature to its $1,000 par value in 13 years. The bond has a coupon interest rate of 9% and pays interest annually a. Find the value of the bond if the required return is (1) 9%, (2) 13%, and (3) 6% b. Use your finding in part a and the graph here, to discuss the relationship between the coupon interest rate on a bond and the required return and the market value of the bond relative to its par value c. What two possible reasons could cause the required return to differ from the coupon interest rate? a. (1) The value of the bond, if the required return is 9%, is $(Round to the nearest cent.) Graph/Chart (2) The value of the bond, if the required retum is 13%, is $(Round to the nearest cent.) (3) The value of the bond, if the required return is 6%, is 5 (Round to the nearest cent.) 1.500 b. Use your finding in part a and the graph here, i 1.400 to answer the following questions: (Select from the drop-down menus.) Q 1 300 1.200 When the required return is less than the coupon rate, the market value is the par value DO 1.100- 1.000 When the required return is equal to the coupon rate, the market value is v the par value When the required return is greater than the coupon rate the market value is 900 300 700 the par value c. What two possible reasons could cause the required return to differ from the coupon interest rate? (Select the best answer below) 600 500 Click to select your answer(s) 9 10 11 12 13 Required return (56) Print Done