i.The Kenya Government has issued a 20-year bond with a par value of KSH 15,200 with an annual coupon paymnent. The return on other bonds of similar risk is currently 12%

The Kenya Government decides to offer a 12% coupon interest rate.

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ii What would be a fair price for these bonds?Suppose interest rates rise immediately after treasury issued the bonds to 15%. but this time bond has semi-annual payments

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iii.Calculate the price of the bonds (5 Marks)

Imagine you paid Ksh 64 for a Ksh 150 bond that has & years left to maturity

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iv. Determine your yield to maturity (5 Marks)

An investor has the option to buy a bond with the following features

Face value KSH 50,000

Coupon interest rate 10.20% payable annually

Year to maturty 3 years

Yield to maturity 14%

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v.Calculate the duration of the bond

Suppose we paid Ksh 38,500 for a Ksh 50,000 par 11% bond with 7 years to maturity and annual coupon payments

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vi. Calculate the bonds yeild to maturity