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Suppose a 2 year 5% (annual coupon) bonds are selling at par (that is, for $100...

Suppose a 2 year 5% (annual coupon) bonds are selling at par (that is, for $100 of face value, the price is equal to $100) and 1 year zero coupon bonds has a yield to maturity of 7%.
(a) What are the 1-year and 2-year interest rates, r1 and r2, respectively?
(b) What should be the price of a two year 8% coupon bond with a face value of $100?
(c) What are the Durations of 5% coupon bonds and 8% coupon bonds? Which one has longer duration? What is the implication about interest rate risk?

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