Complete the following table and draw a graph showing how bond price

for each bond changes over time as they move towards their maturity

dates. Describe the relationship between bond prices and time

remaining for maturity.

Years

remining

to

maturity

BOND A

Coupon rate $=8\%$ p$.$a$.$

Market interest rate $=$

$6\%$ p$.$a$.$

BOND B

Coupon rate $=6\%$ p$.$a$.$

Market interest rate $=$

$6\%$ p$.$a$.$

BOND C

Coupon rate $=4\%$ p$.$a$.$

Market interest rate $=$

$6\%$ p$.$a$.$

$10$

$9$

$8$

$7$

$6$

$5$

$4$

$3$

$2$

$1$

$0$