Problem 1. What is the price today of a 2-year 9% coupon bond that has a par value of $1,000 and a required rate of return of 9%?
Problem 2. You have invested in a bond that pays semiannual coupon payments of $40 and has a par value of $1,000. The bond matures in 1 year, and its required rate of return is 10% compounded semiannually. Determine the bond's present value.
Problem 3. A $1,000 par value bond with an 8.5% coupon and 2 years until maturity is priced at $1,008.91.
a. What is the bond's yield to maturity using annual coupons and annual compounding and
b. also using semiannual coupons and semiannual compounding?