Great Deals LLC appointed you as a financial analyst, and provided you the following information about three bonds: B Bonds Term to maturity (years) Annual coupon rate Frequency of coupons Face value 20 7% Semi annual $1,000 25 5% Semi annual $1,000 25 10% Semi annual $1,000 YTM old 7% 7% 15% 7% 15% new 15% (a) Estimate the value of Bonds A, B and C, based on the old YTM of 7%. [3 marks] (b) If the interest rates increase from 7% to 15% for Bonds A and B, what can you observe on the relationship between the term to maturity and price risk? Show your workings. [3 marks] (c) If the interest rates increase from 7% to 15% for Bonds B and C, what can you observe on the relationship between the coupon rate and price risk? Show your workings. [3 marks] (d) Out of the three bonds, which one would you recommend if you want to reduce the chance of a depreciation in the value of the bond? Explain your answer. [1mark]