Question: Consider and Bo a 3 year bond with face value F=1000 a coupon rate a = 8% paid semi-annually Suppose the bond is treaded at

Consider and Bo a 3 year bond with face value F=1000 a coupon rate a = 8% paid semi-annually Suppose the bond is treaded at a price = 10.20 Answer the following questions 0 Compute the reade of return on this bond if an investor bought it today and decided to hold it till maturity. Keep your answer to decimal places (wreite 5.25% and not 5.3%) Define what it means by the yield to maturity. Compute the yield to maturity on this bond keep your answer to four decimal places in all calculations (for instance, write 5.67% as 0.0567) 4 Suppose you bought that bond from this investor at the end of year 2. How much would you pay for this band if the market interest is 61.2 kwrite 5.67.1. as 2 0567)

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