Assignment 7 Learning Activity 3 - based on Unit 7 1. A 30 year Treasury Bond is issues with par value of $1,000, paying interest of $80 per year. If market yields increase shortly after the T bond is issues, what happens to the bonds: a. Coupon rate b. Price C. Yield to maturity d. Current yield 2. A bond with a par value of $1,000 has a current yield of 7.5% and a coupon rate of 8%. What is the bond's price? 3. One bond has a coupon rate of 8%, another a coupon rate of 12%. Both bonds have 10 year maturities and sell at a yield to maturity at 10%. If the yield to maturity next year are still 10%, what is the rate of return on each bond? Does the higher coupon bond give a higher rate of return