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Q.5 (a) A bond with six years left to maturity has a coupon rate of 9% and a par value of $1000. What is its

Q.5 (a) A bond with six years left to maturity has a coupon rate of 9% and a par value of $1000. What is its coupon if its promised YTM is 12%. (4 Marks)

(b) A 15-year, 10% coupon-interest rate bond has a $1000 par value. The market rate of interest is 8%. Compute the market price of this bond. Assume that interest is paid annually.

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