Chapter 6 Practice problems 1. Suppose FINA Corp. has a bond issue [$1,000 face value] that pays a coupon of 7% per year. The bond matures in 20 years. What is the value of the bond? Po = 2. Now, assume the market interest rate stays the same, what is the value of the bond in one year from now? Po = 3.Now, suppose in the second year, (how many years to maturity?), interest rates on a similar type of bond increases to 8%. What is the value of the bond? Po = 4. Next, after another year, with the market rate still at 8%, what will be the value of the bond? Po= 5.Calculate the one-year holding period return between 3 and 4? 6. Next, suppose in the 10th year, with the market rate still at 8%, what will be the value of the bond? Po= 7. What is the yield to maturity