Bond P is a premium bond with a coupon rate of 9 percent. Bond D has a coupon rate of 4 percent and is currently selling at a discount. Both bonds make annual payments, have a YTM of 6 percent, and have nine years to maturity. What is the current yield for bond P and bond D?
If interest rates remain unchanged, what is the expected capital gains yield over the next year for bond P and bond D? |
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