Question: Dynamic Systems has an outstanding bond that has a $ 1 , 0 0 0 par value and a 7 percent coupon rate. Interest is

Dynamic Systems has an outstanding bond that has a $

1, 000

par value and a

7

percent coupon rate. Interest is paid semiannually. The bond has

8

years remaining until it matures. Today the going interest rate is

10

percent, and it is expected to remain at this level for many years in the future.

Compute the current yield. Do not round intermediate calculations. Round your answer to two decimal places.

%

Compute the capital gains yield that the bond will generate this year. Do not round intermediate calculations. Round your answer to two decimal places.

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