Q2. A 4-year 5.8% coupon bond is selling to yield 7%. Assume the bond pays interest annually and has a face value of $100. (13 marks)

a) What is the price of the 4-year 5.8% coupon bond selling to yield 7%? (5 marks)

b) What is the price of this bond one year from today in case the yield stayed unchanged at 7%? (4 marks)

c) What is the price of this bond one year from today one year later if in case instead of the yield being unchanged the yield decreases dropped to 6.2% instead?(4 marks)