A 5.60% annual coupon, 5-year bond has a yield to maturity of 9.50%. Assuming the par value is $1,000 and the yield to maturity is expected not to change over the next year.
a) What should the price of the bond be today?
b) What is the bond price expected to be in one year?
c) What is the expected Capital Gains Yield for this bond?
d) What is the expected Current Yield for this bond?
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