Question: Assuming that the current interest rate is 3 percent, compute the present value of a five-year, 5 percent coupon bond with a face value of

Assuming that the current interest rate is 3 percent, compute the present value of a five-year, 5 percent coupon bond with a face value of $10,000. What happens when the interest rate goes to 4 percent? What happens when the interest rate goes to 2 percent?

Instructions: Enter your responses rounded to the nearest penny (two decimal places).

PV at an interest rate of 3% =

PV at an interest rate of 4% =

PV at an interest rate of 2% =

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