** The next 5 questions are based on the facts listed below. Overall the questions deal with Time Value of You are buying a 10 yr 7% coupon bond with a face value of $200,000. You want to determine the purchase price of the bond when yields are now 5%. 1 What is the annual coupon (fixed interest) payment on the Bond. Note: this is your annuity. 2 What is your discount rate to be used for time value purposes ? 3 Calculate the PV of the future interest payments (PV of annuity chart). Hint:( PV of annuity chart "D" or "A4"). Annuity is from Question 1 4 Calculate the PV of the $200,000 principle payment ? Hint: (PV of a $1: "B" or "A2") Sum of 5&6 should be less than $200k 5 If the seller originally paid Par for the bond, what is their gain ? Note: Add #