What is the current yield for bond

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Reference no: EM133432283

Question: Bond P is a premium bond with a coupon rate of 8 percent. Bond D has a coupon rate of 3 percent and is currently selling at a discount. Both bonds make annual payments, have a par value of $1,000, a YTM of 5 percent, and have seven years to maturity. a.What is the current yield for Bond P and Bond D? b. If interest rates remain unchanged, what is the expected capital gains yield over the next year for Bond P and Bond D?

Reference no: EM133432283

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