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January 30, 2015

January 30, 2015

Posted by **LIT** on Tuesday, February 2, 2010 at 2:46pm.

a) what is the YTM expressed as a quoted rate based on semi-annual compounding? And what is the effective annual YTM on this bond?

b)What is the bond's expected price two years from now? What is its capital gains yield for year 2? What is its current yield at the beginning of year 2? What is the expected total return for year 2?

c) What would happen to the price of the bond over time, as the bond gets closer to maturity? (Again, assuming no change in interest rates)

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