What is the Part C of this question? Thank you!

3. Consider the following 3 risk-free bonds, all with face amounts of $1 ,000: (i) a 1-year zero-coupon bond, (ii) a 2-year bond with a coupon rate of 6% (annual coupons), and (iii) a 2-year zero-cou pon bond, all with yields of 6%. a. What are the Macaulay durations of these 3 bonds? What are the modied durations? [i] o=1, o*=o.94 [ii] o=1.94, D*=1.83 {iii} o=2, D*=1.89 b. If the yields on all 3 bonds rise immediately to 7%, what does the duration predict will be the percentage change in the bond price? What is the actual percentage change in the bond price? (i) P(6%}: 934.50, P(7"/..}= 943.4, predicted: -0.94%, actual: -0.93% (ii) P(6%)=901.92, P[7%): 1000, predicted: 4.83%, actual: 4.01% (iii) P(6%}:B?3.44, P[7%)= 890, predicted: 4.89%, actual: 4.06% c. At the original yield of 6%, what positions in the 2 zero-coupon bonds would you take to immunize a long position of $1,000 in the 2-year bond? What is the change in the value of this immunized portfolio if the yields on all the bonds rise immediately to 7%