Finance: Debt

*Please do not use Excel. If you could show working that would be amazing and appreciated. Thank you very much

1. A bond with a face value of $10,000 that matures in exactly seven years has a price of $10,494.63. The coupon rate is 4.2% p.a. and coupons are paid every six months. Which of the following figures is the closest to the yield to maturity? ( I know the answer is C but I do not know how to work that out)

(a) 4.2% p.a.

(b) 5.40% p.a

(c) 3.40% p.a.

(d) 1.70% p.a.

2. On the 1st October 2016, K.J Limited issued bonds with a maturity date of 1st October 2028. One K.J bond has a face value of $100,000 and the coupon rate is 4.50% p.a. with interest payable half-yearly. Assuming the market yield is 6% p.a. calculate the value of one bond:

(a) on the 1st October 2020.

(b) five years before maturity.

(c) one year before maturity.