PLEASE ANSWER ALL QUESTION!! I REALLY NEED THEM.

Consider a two-year coupon bond issued by an airline

with-a face value of $1,000,-

a coupon rate of 3%,

-an annual default probability of5%,

-and a risk-free interest rate of 3% per year

1. Use a binomial tree to value the bond assuming no recovery. Show your work for partial credit; write your answer in dollars and cents on the line below. The value (price, expected present value, etc.) of the bond is ?

2.Calculate the yield to maturity of the bond from question 1?

3. Assume the recovery rate is 60% so that bondholders recover 60% of the face value upon default. Use the binomial tree to calculate the value (price, expected present value, etc.)Show your work for partial credit; write your answer in dollars and cents. The value of the bond is ?

4. What should it cost to insure the bond of question 3 against default? You can use the binomial tree or the law of one price answer the question. Calculation of the binomial tree is complicated by the need to incorporate the recovery into the payoff from insurance The law of one price is simpler and what I recommend. Use the value of the risky and risk-free bonds to infer the value of the insurance. Show your work for partial credit; write your answer in dollars and cents. The price of the insurance should be?

5. The two-year coupon bond of question1tradesin the market at a price of $900.Assumerecovery is 50% (half). Calculate the yield to maturity of the bond and use the credit triangle formula to approximate the probability of default. Provide your answer as a percentage with two decimal places. Show your work for partial credit. The default probability implied by the credit triangle using a recovery rate of 50% is ?