uppose you buy a $6$ percent coupon bond today for $$1,180.$ The bond has $10$ years to maturity and pays coupons semi$-$annually.

a$).$ What rate of return do you expect to earn on your investment?

b$).$ Two years from now, the YTM on your bond has decreased by $2$ percentage points, and you decide to sell. What price will your bond sell for?

c$).$ What is the realized yield on your investment? Assume interest payments are reinvested at the original YTM$.$

d$).($PRACTICE$)$ Compare this yield to the YTM when you first bought the bond. Why are they different?

$($Note: Round your answer to four decimal places; Use a financial calculator to solve this problem, and document the key sequences entered, like $[$N$],[$PMT$],[$CF$],$ etc.$)$