i need help with part B please. A government bond with 2 years until maturity has a face value of £120,000 and an annual nominal coupon rate of 1%. Assume that the relevant nominal market interest rate (annualized) is equal to 5%. The coupon payments are made every 6 months. (a)  Calculate the present value of the bond. (b)  Assume the individual coupons are stripped from the bond and sold separately as zero coupon bonds. Calculate the market value of these zero coupon bonds. Assume there are no further changes to the market rate. How would you expect the price of the bond to evolve?

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Bond Valuation

Bond valuation are the notes issued by the corporation to raise long-term funds for the business. The corporations are required to pay the interest on such liabilities at a specified rate of interest (termed as coupon rate) at specified dates which may be on semi-annual or annual basis. These interest payments may be in the form of coupons.