a. What is the loss or gain to a Swiss investor who holds this bond for a year?

Purchase price = 1,700 SF

Current value = PV of maturity + PV of Coupon payments

Current Value = 1700/(1+11%)^9 + 153(1-(1+11%)^-9)/11%

Current Value = 664.57 + 847.17

Current Value = 1511.74 SF

Loss = Purchase price – Current value

1511.71-1700

=188.26 SF

b. What is the loss or gain to a U.S. investor who holds this bond for a year?

Purchase price = 1700 SF X 0.66667 = $ 1133.339

Current value = PV of maturity + PV of Coupon payments

Current Value = 1700/(1+11%)^9 + 153(1-(1+11%)^-9)/11%

Current Value = 664.57 + 847.17

Current Value = 1511.74 SF

Current Value = 1511.74 SF X 0.74074 = $ 1119.81

Loss = Purchase price – Current value = $ 13.53