Question: Please manually show calculation behind part b. 2. Bonds (25 points] You are the CFO of a company selling bikes. You need to make renovations

Please manually show calculation behind part b. 2. Bonds (25 points]

Please manually show calculation behind part b.

2. Bonds (25 points] You are the CFO of a company selling bikes. You need to make renovations to the company's headquarters. To finance the renovations you issue bonds. You issue bonds with a 7-year maturity and a face value of 1,000 making semi-annual coupon payments. The coupon rate is 2% and the yield to maturity is 1.6%. a. What are the bond's payments (cash flows)? [4] The coupon rate is 2% The cash flows are 14 payments of 10 and one payment of 1,000. b. What is the price of the bond? [5] The bond has a coupon rate of 2% and a yield of 1.6%. The price is 1026.39

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