Response to the following problem:
Suppose three years ago you bought an ABC Company bond that pays 6% per year (paid semiannually) and it has three years to maturity at its par value of $1,000.
a. If you sell the bond when it is priced to yield 8%, what is your gain or loss on this investment?
b. If you sell the bond when it is priced to yield 4%, what is your gain or loss on this investment?
c. If you sell the bond when it is priced to yield 10%, what is your gain or loss on this investment?