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3.Please show full calculations in the table. 15 points coupon rate, matures in 3 years and has a par value of $1,000. Show full calculations in the table below. 1.a. Calculate the price and duration for the following bond when the going rate of interest is 3%. The bond offers 2.75% Bond PV (Cash Flows) Year Present Value of Cash Flow Cash Flows YR | PV of $ 1 at 390 Total Price = Duration
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Face value of bond-$1,000 Term - 3 Years Coupon rate-2.75% Yield rate (YTM)-3% Coupon amount-Face value * Coupon rate-$1,000 * 2.75%-$27.5 ation of Current price of bond and duration of bond Year PV of $1 at 390 Bond cash flows PV of cash flows Year * PV of cash flows WS 1 0.970873786 $27.50 2 0.942595909 S27.50 3 0.915141659 $1,027.50 $26.70 $25.92 S940.31 $992.93 $26.70 S51.84 $2,820.92 S2.899.47 Current price of bondSum of (Present value of cash flows) S992.93 Duration of bond - Sum of (Year * PV of cash flows) / Sum of (PV of cash flows) - $2,899.47/$992.93 - 2.92011565 - 2.92 Years Note : PVIF(I, n) -1/(1+

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