(ii) Briefly discuss the importance of ethics in financial markets (3 marks)

A $1,000, 180-day Treasury bill is sold at a price of $950. Assuming there are 365 days in a year, calculate the yield of the bill. (3mark)

Consider a zero-coupon bond with 15-years to maturity. Calculate the percentage change in the price of the bond if its yield to maturity increases from 4% to 6%. (3mark)

A key relationship in bond valuation is that between bond value and interest rate. Briefly describe this relationship. (2mark)

What is the role of credit rating agencies and why are bond ratings important to investors? (2mark)