Investors with a one-year investment period are considering three types of bonds: The following bonds all have the same default risk and a maturity of two years. If necessary, assume that it is now January 1, 2020. Bond 1: zero-coupon bond payable $1,000 on maturity Bond 2: 8% Coupon rate and $80 Coupon payment at the end of each year Bond 3: 10% Coupon rate and $100 Coupon payment at the end of each year

a) When all three of the above bonds have a yield-to-maturity value of 8%, obtain the current price of the three bonds.

b) When yield-to-maturity is expected to be 8 percent on January 1, 2021, obtain the price of three bonds on January 1, 2021. And when you hold three bonds for a year from now, find holding-period returns.

c) When yield-to-maturity is expected to be 7% on January 1, 2021, obtain the price of the three bonds on January 1, 2021. And when you hold three bonds for a year from now, find holding-period returns.