1. Missionary Ridge offers a 10 percent coupon bond with semiannual payments and a yield to maturity of 12 percent. The bond matures in 16 years. What is the market price per bond if the face value is $1,000?
2. Canaan Adventures offers a 7 percent coupon bond with annual payments. The yield to maturity is 5 percent and the maturity date is 10 years from today. What is the market price of the bond if the face value is $1,000?
3. You would like to give your son $100,000 towards his college education 13 years from now. How much money must you set aside today for this purpose if you can earn 7 percent on your investments?