Suppose you purchase a $1000 Face-Value Zero-Coupon Bond with maturity 30 years and yield to maturity 4% quoted with ann

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Suppose you purchase a $1000 Face-Value Zero-Coupon Bond with maturity 30 years and yield to maturity 4% quoted with ann

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Suppose you purchase a $1000 Face-Value Zero-Coupon Bond withmaturity 30 years and yield to maturity 4% quoted with annualcompounding. Show the bond cash flows on a time line and computethe current price of the bond Draw a graph to illustrate how theprice of this bond will change as it gets closer to maturity –Price (on y axis) vs Time (on x axis). Why is a zero-coupon bondmore sensitive to interest rate changes than similar coupon bearingbonds (2 or 3 sentences)?
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