An investor has two bonds in his portfolio. Each bond matures in 4 years, has...
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An investor has two bonds in his portfolio. Each bond matures in 4 years, has a face value of $1,000, and has a yield to maturity equal to 8.5%. One bond, Bond C, pays an annual coupon of 10%; the other bond, Bond Z, is a zero coupon bond. Assuming that the yield to maturity of each bond remains at 8.5% over the next 4 years, what will be the price of each of the bonds at the following time periods? Assume time 0 is today. Fill in the following table. Round your answers to the nearest cent.
| T | Price of Bond C | Price of Bond Z |
| 0 | $ | $ |
| 1 | ||
| 2 | ||
| 3 | ||
| 4 |
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