For this problem, we will be calculating the return on a 3-year, zero-coupon treasury. The zero-coupon bond is described below:

Face value = $100

Price = $97.06

Yield-to-maturity = 0.01 (1%)

As it turns out, you find yourself in a position to sell the bond exactly one year after you purchased the bond. Yields on these types of bonds have risen from 1% to 5% over that year.

(a) What will the price of your bond be when you sell it? You will need to round your answer to the nearest cent (which is simply two decimal places).

(b) What was your rate-of-return on holding the bond for one year? Please report your answer as a percentage. You will need to round your answer to two decimal places. Keep in mind that this bond is a zero-coupon bond.