with formula of calculations used please

8. a) A fixed interest bond with a coupon of 6% per annum payable quarterly, redeemable at 108% of par, with the next coupon due in three months, is being issued by the government. The coupon will be redeemed at the option of the borrower any time between 12 and 18 years after issue. i) Determine the price that Investor A, who is liable to income tax at 25% (but no capital gains tax), will be willing to pay per 100 nominal of this bond, given that she requires a net redemption yield of 4% per annum. ii) After seven years, Investor A decides to sell the bond. Determine the price that Investor B will be willing to pay for the bond at this time, given that investor B is also liable to income tax at 25% (but no capital gains tax) and that he requires a net redemption yield of 5% per annum. iii) Explain briefly, without carrying out further calculations, how your answers to this part of the question would change if both Investor A and Investor B were liable to Capital Gains Tax (CGT). [12 marks] b) Investor C is considering an investment with uncertain future payments as follows: Timet Amount Probability (years) 1.5 100 0.9 100 0.8 100 0.7 3 4 Assuming that the probabilities are independent, and making your working clear, calculate the expected present value (at time t=0) of this investment, using an effective interest rate of 7% per annum. [3 marks] c) Investor D is considering investing in a bond with an annual coupon where the first payment, due in one year, will be 6, and coupon payments will increase by 2% compound each year. The bond will be redeemed at 98 in eight years (not subject to annual increases), and the investor requires a net redemption yield of 8% p.a.. The investment is not subject to tax. i) By drawing a timeline, or otherwise, derive an expression for the price of this bond, defining all notation used. ii) Calculate the price Investor D would be willing to pay for this investment. [5 marks]