Question: Consider two bonds. Both bonds make annual payments, have a YTM of 5 percent, and have five years to maturity. Bond X is a premium

Consider two bonds. Both bonds make annual payments, have a YTM of 5 percent, and have five years to maturity. Bond X is a premium bond with a coupon rate of 8 percent. Bond Z has a coupon rate of 3 percent and is currently selling at a discount a. What is the current yield for Bond X and Bond Z? (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 X and Bond Z? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) % % a. Bond P current yield Bond D current yield b. Bond P capital gains yield Bond D capital gains yield % %
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