I. A one year bond is currently selling for $80, has coupons of 5% pa and face value $80. A two year bond is currently selling for $90, has coupons of 3% pa and face value $100. A three year bond is currently selling for $85, has coupons of 10% pa and face value $80. All three bonds pay coupons annually, starting one year after purchase. (a) Use these three coupon bonds to find the zero-coupon bond values P(0, 1), P(O,2) and P(0,3). Show all working. (b) Use the zero-coupon bond values P(0, 1), P(0,2) and P(0,3) to find the re- turns R(n, j) over the next three years (that is, for n = 0, 1, 2 and 0-j-n), rivan ihai, ihe parameters fr ihe Illa) 1KX, Inodel are a O.A aud 0.92. Note that you should find sir different returns. (c) Identify any returns in part (b) which have an unexpected value. How might you change the Ho-Lee parameters to avoid this issue