Question: A 1 0 - year bond with a face value of $ 1 , 0 0 0 and 1 2 % annual coupons is trading

A 10-year bond with a face value of $1,000 and 12% annual coupons is trading with a current yield to
maturity of 12% compounded annually.
An investor recently purchased the bond and plans to sell it in 5 years time, right after receiving a coupon
payment. The projected yield to maturity (YTM) at the sale is 16% compounded annually, and the expected
reinvestment rate for coupons is 10% compounded annually.
What is the price of the bond today?
$
(Round to two decimal places)
What is the expected bond price in 5 years' time?
$
(Round to two decimal places)
What is the total expected value of the reinvested coupon payments in 5 years' time?
$
(Round to two decimal places)
What will be the expected annual rate of return on this bond investment in 5 years' time?
%(Round to two decimal places)
 A 10-year bond with a face value of $1,000 and 12%

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