OUD UU Pono) 1. A bond with an annual coupon rate of 8% and the term to maturity of 10 years. The bond has face value of $1,000 and makes semiannual interest payments. a) If you require a 12% nominal yield to maturity on this investment now (with the term to maturity of 10 years), what is the maximum price you should be willing to pay for the bond? b) Two years after the bond was issued, the going interest rate fell to 7%. At what price would the bond sell? c) Suppose that 2 years after the issue date interest rates fell to 7%. Suppose further that the interest rate remained at 7% for the next 8 years. The price of bond will (Decline or Rise), approaching $1000 at the maturity date