the calculation of the duration and convexity of a bond with a face value of $1,000, term to maturity of 3 years, a coupon rate of 6% per annum, payable yearly, and a yield to maturity of 4% per annum. [NOTE: As a by-product of these calculations, you should calculate the current market price of the bond, which price should be used as a base or starting point to your answers required in C. i. and C. ii. below.] C. Calculate the expected price of the bond described in B. above, if the yield to maturity fell immediately to 3% per annum, by each of the following 3 methods. i. The duration adjustment method. ii. The duration-with-convexity adjustment method. iii. The present value of future cash flows method. D. Which of the methods listed in C. above is most accurate? Why? E. Explain how a pension fund can use zero-coupon bonds to immunize its obligation to pay out $10 million a year in pensions in perpetuity, if the forecast long-term interest / discount rate is 5% a year forever.