Question: A 20-year bond is lessed today with a face value of $1,000. The bond pays semi-annual coupon at 5% pa. (nominal). The issue price gives

A 20-year bond is lessed today with a face value of $1,000. The bond pays semi-annual coupon at 5% pa. (nominal). The issue price gives potential investor a yield to maturity of 6% p.a. (nominal) Without calculation, you can tell the bond must be a discount bond. (1 mark) You have this conclusion because _Select one of the following reasons). (1 mark) Othis is a coupon bond the face value must be lower than the price of the bond Othe bond pays coupon every half year the coupon rate is smaller than the yield to maturity Calculate the issue price of the bond. (Round your answer to 2 decimal places. Do not include the symbol. Do not use comma separators. Eg. 123456) (2 marks) 88443

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