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Question Two: Find the prices of a 10% coupon bond with a face value of $4000 on the following yield to maturities: 0.12,0.11, 0.10, 0.09,
Question Two: Find the prices of a 10% coupon bond with a face value of $4000 on the following yield to maturities: 0.12,0.11, 0.10, 0.09, and 0.08, and 4 years to maturity. Calculate the interest rate at each price. Further, write down the formula of the present value for this question. (1.5 points) Question Three: based on your results in questions 1 and 2 (2 points) 1) Write down the formula of the present value for questions 1 and 2. 2) What is the relationship between the interest rate and the price of the bond? 3) What is the relationship between yield to maturity and interest rate in question 2
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