The Severn Company's bonds have four years remaining to maturity. Interest is paid annually, the bonds have a $1,000 par value, and the coupon interest rate is 9 percent.

Compute the yield to maturity for the bonds if the current market price is (1) $829 or (2) $1,104.

Would you pay $829 for one of these bonds if you thought that the appropriate rate of interest was 12 percentthat is, if rd = 12%? Explain your answer.

PLEASE show all work.