You want to make a 5-year investment on bonds, and if you buy bonds with longer period

of maturity, they will be sold at the prevailing market price at the end of the fifth year.

All coupons will be reinvested. You forecast that the rates are going to change after you

purchase the bonds.

Now you have three bonds with same initial YTM to consider:

A. 5-year maturity, 6% coupon paid annually, YTM=9%

B. 10-year maturity, 8% coupon paid annually, YTM=9%

C. 15-year maturity, 4% coupon paid annually, YTM=9%To pick the best one, you want to

calculate the following (show your work to get full credit, keep four decimals)

4) What are the HPRs for the three bonds?