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Calculate the present value of $1,000 zero-coupon bond with 5 years to maturity if the required annual interest rate is 6%.

Consider a bond with a 7% annual coupon and a face value of $1,000. Complete the following table:

Years to Maturity Discount Rate Current Price
__________________________________
          3                       5
          3                       7
          6                       7
          9                       7
          9                       9
__________________________________

What relationship do you observe between yield to maturity and the current market value?
 
Years to Maturity Yield to Maturity Current Price
_____________________________
              3                   5                   
              3                   7                   
              6                   7                   
              9                   5                   
              9                   9                   
_____________________________

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