Bond A has a coupon rate of 10%, with a three-year maturity and a face value of $1,000. The discount rate now or future is 10%.

1. If you want to buy bond A now, what is the price you have to pay?

A)   $1,000

B)   $1,200.

C) $1,250

D) cannot be decided

E)   none of the above

2. If you want to buy bond A now and hold it for one year, what is the expected return for your investment?

A)   8%

B)   10%

C) 12%

D) -12%

E)   none of the above

10. If you want to buy bond A now and hold it until its maturity, what is the expected total return for your investment?

A)   8%

B)   5%.

C) 4%

D) no enough information

E)   none of the above