1. For each of the following bonds, compute the premium or discount and the purchase price, and construct the appropriate bond schedule.

   1. a) A $5500, 8% bond redeemable at par in three-and-a half years with semi-annual coupons is purchased to yield 6.5% compounded semi-

      annually.

   2. b) A $20 000 bond with interest at 13.5% payable quarterly redeemable at par is bought two years before maturity to yield 11% compounded quarterly.