Problem 1:	You are considering investing in a 10-year bond issued by NewEnergy Inc. This bond has $1000 face value, 4% coupon rate.
The bond pays coupons semi-annually and is currently selling at $920. The bond can be called at a $1,040 in 3 years.

1.a. (10 points):

If your required rate of return if 6% for bonds in this risk class, what is the maximum price you should pay for this bond? (Use PV function)

Coupon rate=

Required return=

N=

Years to maturity=

I/Y=

Payment frequency=

FV=

Face Value=

PMT=

Call price=

PMT Type=

Current market price=

PV=

the maximum price you should pay for this bond:

1.b. (10 points)	What is the current yield of this bond?
Current yield =