A zero coupon bond has a face value of 1000 and matures in


1. A zero coupon bond has a face value of $1,000 and matures in 6 years. Investors require a (n) 6.6% annual return on these bonds. What should be the selling price of the bond?

2. You decide to buy a house for a total of $321508. To get a mortgage loan, you make a 10% down payment, and the bank will lend you the rest. The interest rate quoted for this loan is 3% APR, and the loan will be paid (and interest compounded) every month, for the next 30 years. How much is the TOTAL monthly payment for this mortgage?

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Risk Management: A zero coupon bond has a face value of 1000 and matures in
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