Question: If a bond's yield to maturity does not change, the retum on the bond each year wil be equal to the yield to maturity. Confirm

 If a bond's yield to maturity does not change, the retum

If a bond's yield to maturity does not change, the retum on the bond each year wil be equal to the yield to maturity. Confirm this for both a premium and a discount bond using a 4-year 3 percent coupon bond with annual coupon payments and a face value of $1,000 a. Assume the yield to maturity is 2 percent. What is the current value of the bond? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Bond price today 980 05 What will the bond value be in one year? (Do not round intermediate calculations. Round your answer to 2 decimal places.) What is the rate of return for the first year? (Do not round intermediate calculations. Enter your answer as a percent rounded to the nearest whole number.) Rate of refurn b. Assume the yield to maturity is 4 percent. What is the current value of the bond? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Bond price today What will the bond value be in one year? (Do not round intermediate calculations. Round your answer to 2 decimal places.) one year Bond What is the rate of refurn for the first year? (Do not round intermediate calculations. Enter your answer as a percent rounded to the nearest whole number.) Rate of return

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