Problem 1:

A bond has a $1,000 par value, 10 years to maturity, and a 8% annual coupon and sells for $980.

What is its yield to maturity (YTM)? Round your answer to two decimal places.

%

Assume that the yield to maturity remains constant for the next 4 years. What will the price be 4 years from today? Round your answer to the nearest cent.

$

Problem 2:

Potter Industries has a bond issue outstanding with an annual coupon of 6% and a 10-year maturity. The par value of the bond is $1,000. If the going annual interest rate is 8.8%, what is the value of the bond? Round your answer to the nearest cent. Do not round intermediate calculations. $

Problem 3:

Potter Industries has a bond issue outstanding with a 6% coupon rate with semiannual payments of $30, and a 10-year maturity. The par value of the bond is $1,000. If the going annual interest rate is 8.8%, what is the value of the bond? Round your answer to the nearest cent. Do not round intermediate calculations. $