BONDS

PLEASE ANSWER ALL QUESTIONS AND SHOW WORK.

Bond Questions 1 Consider the following four bonds: Coupon Issue 5 years Zero Coupon PerpetualConvertible 5 yearsInfinity Maturity Coupon rate 5 years 5% | 6% zero 6% If the market yield is(7%, what is the value of the three first bonds (assuming that the face value is $1,000)?Jolc fon pv Why are the values of the bonds lower than their face values? Why is the coupon rate for the convertible bond lower than that of the nonconvertible, coupon issue? Suppose that the market yield rises to 7.5%, what are the bond values at that yield? a. b. c. d