Smith is purchasing a 6 year coupon bond with a face (coupon) rate of 6%. Interest will be made annually and the yield to maturity (market rate) is 10%.

1) Draw/sketch the repayment timeline. Show all 6 years in your timeline. Include all relevant cash flows in your timeline.

2) Will the bond sell for a discount or a premium?

3) Compute the bond price. Utilize the time value tables from the text or a time value Show your work / app inputs. app.