1. Compute the market price (V_b) of the following $1,000 par value bonds with 10-year maturity: (15)

1. 8% coupon (interest rate) paid semi-annually? Assume the yield to maturity of 12%.
2. 6% coupon (interest rate) paid semi-annually? Assume the yield to maturity of 12%.
3. 8% coupon (interest rate) paid semi-annually? Assume the yield to maturity of 6%.

Based on your answers, comment on the relationship (what happens to one variable when the other goes up/down) of (a) price with yield to maturity and (b) price with coupon rate. (5)