Joe Blue was recently in an auto accident which occurred because of a manufacturing flaw in his automobile. As a result, the car maker is liable for damages to and has agreed to make payment today for all his losses resulting from the accident. He was not permanently injured but his initial medical bill was $25,000 which was paid two months ago. In addition, he has already missed two months of work and expects to be out of work for the next ten months. He currently earns $4,200 per month and expects that his wage rate will remain unchanged over the course of the next ten months. However, he also expects to lose a bonus check of $6,000 which, on the basis of past history, would have been paid ten months from today. During his time of recovery he will incur $4,500 in medical care expenses every month for the next eight months. If Joe can earn 9 percent interest compounded monthly on his investments, calculate the present value of the loss he suffered as a result of the accident not including any additions for pain and suffering. Find the price of a 15 -year bond with a $1,000 par value and 7% coupon rate (semiannual coupon payments) if the required rate of return in the market is 10%. Find the price if the required rate drops to 5%. What will happen to the market price in each situation after 5 years? ..after 10 years