You own a bond that pays $$30$ in annual interest, with a $$1000$ par value. It matures in $20$ years.

Your required rate of return is $4\%.$

A$.$

Calculate the value of the bond.

B$.$

Calculate the value of the bond if your required rate of return:

$($i$)$

increases to $7\%$

$($ii$)$

decreases to $2\%$

C$.$

Explain the implications of your answers in part B$.$ as it relates to interest rate risk,

premium bonds, and discount bonds.

D$.$

Given that a bond with a face value of $$1,000$ is being issued on the market at a

discounted price of $$800.$ The coupon rate for the bond is $12\%$ and the bond will reach

maturity in $8$ years. calculate the yield to maturity for the bond