Bond P is a premium bond with a coupon rate of 9.2 percent. Bond D is a discount bond with a coupon rate of 5.2 percent. Both bo
nds make annual payments, have a YTM of 7.2 percent, have a par value of $1,000, and have seven years to maturity. a. What is the current yield for Bond P? For Bond D? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) b. If interest rates remain unchanged, what is the expected capital gains yield over the next year for Bond P? For Bond D?
1 answer:
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