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Bond value and time-Changing required returns Personal Finance Problem Lynn Parsons is considering investing in...

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Accounting

Bond value and time-Changing required returns Personal Finance Problem Lynn Parsons is considering investing in either of two outstanding bonds. The bonds both have $1,000 par values and 13% coupon interest rates and pay annual interest. Bond A has exactly 9 years to maturity, and bond B has 19 years to maturity.
a. Calculate the present value of bond A if the required rate of return is: (1)10%,(2)13%, and (3)16%.
b. Calculate the present value of bond B if the required rate of return is: (1)10%,(2)13%, and (3)16%.
c. From your findings in parts a and b, discuss the relationship between time to maturity and changing required returns.
d. If Lynn wanted to minimize interest rate risk, which bond should she purchase? Why?
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