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Lance Whittingham IV specializes in buying deep discount bonds. These represent bonds that are trading at well below par value. He has his eye on a bond issued by the Leisure Time Corporation. The $1,000 par value bond with semiannual payments has 4 percent annual interest and has 10 years remaining to maturity. The current yield to maturity on similar bonds is 12 percent. (Round "PV Factor" to 3 decimal places. Do not round intermediate calculations. Round the final answers to 2 decimal places.) a. What is the current price of the bonds? Use RpendixB and ppendixD. Current price $ b. By what percent will the price of the bonds increase between now and maturity? Price increases by \% c. What is the annual compound rate of growth in the value of the bonds? (Use Appendix.A) Annual compound rate % WITFvrv[(1+)1]=rv(1+) APPENDIXD \begin{tabular}{|c|c|c|c|c|c|c|c|c|c|c|c|c|c|c|c|c|c|c|c|c|c|c|c|c|c|} \hline & \multicolumn{25}{|c|}{ Porent } \\ \hline & N & n & x & A & is & or & n & is & r & m & m & in & in & in & & is: & in & in & m & m & 25 & in: & 35 & sin & sen \\ \hline 1 & ano & onio & osis & & & OMJ & ons & 6326 & 0mo & 0965 & 6901 & ois & atts & om & & & & os & osio & ass. & 8100 & ary & & 24 & obs \\ \hline 2 & & & 190 & 14k & 103 & (to) & Inot & & 189 & 104 & & 100 & (14) & & ises & 1001 & (1sts: & 15m & ise & & 1+10 & & Las & & ini \\ \hline 3 & & aut & 2xa & 2s & 2 & 200 & 2624 & 2nn & 2981 & 245! & 244 & 2+62 & & & 220 & 2364 & 2210 & 23y & 2100 & 2366 & & this & 165 & tsn & (a) \\ \hline 4 & 1002 & inet & in & & 2546 & & 33 & I3H & 3240 & 170 & 302 & 20% & 2m & 2014 & & 271 & 2703 & 2010 & 2679 & & 2102 & 2146 & in) & ins & toos \\ \hline 3 & tsos & 470 & 400 & 449 & 433 & & 4100 & & & 231 & 1000 & & & 3+1 & lng & 3n & Jis & 3m & jost & 2m & 240 & 2+30 & 220 & 20n & 1m \\ \hline+ & 3m & 5601 & tatt & & 1006 & is & as? & 462 & 440 & 435 & 421 & 4111 & 3m & 3ts & 3 & & iss & 3at & 109 & & 239 & 260 & 231 & & itid \\ \hline 7 & -ra & & 0.200 & 4002 & 376 & & sin & 1304 & & Itat & 472 & 444 & (+1) & & tise & 40% & wh & 1min & & & lin & 2102 & 20 & & (tas \\ \hline 1 & & tas & 2000 & + & 6+63 & 6210 & & 3741 & sos & sose & 11+4 & ant & 49 & & (4t) & 434 & & cos & Ibs & ini & & 2938 & Isps & & \\ \hline , & ist & tik? & 7mb & tor & toue & 4102 & 6513 & 6 & sm & & (53t & bat & 5w & 484 & in & 4 kar & 768 & 41 & (is) & cell & (3)s & 3013 & 245 & m & \\ \hline 10 & , An & asis & & tiin & im & & 7bat & & & 6its & 14 & 1010 & 346 & 326 & tow & aw & & tos & 430 & & & 3002 & 276 & 244 & Ins \\ \hline H. & ie 3et & , rat & & 1760 : & 1004 & Jist & rass & in & & & s.ar & 304 & 3km & sass & 3114 & & 4116 & 4044 & 4+44 & (3) & 364 & 1144 & 232 & 247 & in? \\ \hline 1 & 1125 & 1037 & & 9us & 116) & t.184 & 181 & 7536 & ris & & & 6BH & & & & sin & 431 & (m) & teil & (t) & its & lin & 2m & 264 & ints \\ \hline v & & Hiet & 1060 & , nte & , 34 & (13) & sist: & & tat! & tos & sine & 604 & ln & sin & 534: & 336 & tra & & ins & 43 & 3130 & 323 & 2m & & \\ \hline is & 0004 & & 1126 & 1034) & sw & & cos & 1224 & 174 & 1367 & & & & 600: & & 364 & 128 & & 4 bet & 4 a11 & 3ks & 530 & 234 & 247 & (w) \\ \hline Bs. & biss & ctse: & nos & nut & 103t0 & pro & siot & tsss & 1061 & & tat & & (6) & 6162 & int. & 355 & lng8 & rone & & 4ns & 3is & 1231 & 2tat & 24% & ins \\ \hline is & 4 & 37 & itse & Hos? & 10ms & is its & 9447 & tis! & 130 & 7124 & 13n & 6n & 664 & & 594 & 541 & 5cos & 5in & 403 & 170 & 3m & & 214 & 241 & in \\ \hline is: & & Han & is 16 & Diat & 18234 & 10+17 & +28 & nz & & 2022 & 7349 & 7120 & & sm & sect & 574 & sor & sin & 4mt & 4 & 1010 & 12n & & 22 & m \\ \hline at & a & non: & & nos & 1140 & & 10 es? & im & the & 11 & 1002 & 720 & & (4) & 6n & 9til & 5304 & 32n & 1a3 & 4at. & 39 & 3394 & 214 & & 1m \\ \hline n & & 4 & H3s & & 12 ots & 1184 & 1038 & 9604 & tne & 184? & tim & 134 & 6011 & 6.59 & ont & 3 th & 5144 & mis & 194 & (16) & ses & & 2u & & in \\ \hline 20 & Heet & & 14:s & & & IIte & 1054 & sit & ths & s4 & (H) & tat & toss. & (4) & e.24 & ins & 163 & 323 & & & 3mu & & 2110 & 1 an: & Im \\ \hliney & & ass & EAu & Han & wos & aw & IIA4 & 10 s.s & , Bi). & tant & 14 & & & sw & e.t. & sopt. & & 346 & sin & ant & 3n & 33 & 2394 & 2 & 1000 \\ \hline N & 2s set & nw & & m & sin & ates & & 1 & w) & o at: & & 1041 & tas & r() & 636 & kin & 5x & set & & in & & & 2 in & 2000 & 2000 \\ \hline 40 & & now & (1ius & (n) & arip & How & u3n & & ats? & 97 & & 124 & tos & 7109 & 6.64 & 4m & 1mi & isi & & am & 3m & 33n & 231 & 2000 & 2000 \\ \hline * & WIA & & & & & & Usai & (2) & & t9is & get & 190 & tan & 718 & 6se & 674 & 930 & & & 4m & 4000 & 33 & & 20 & 2000 \\ \hline \end{tabular}

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