a. What is the relationship between the price of a bond and it's YTM? b. Explain why

Question:

a. What is the relationship between the price of a bond and it's YTM?
b. Explain why some bonds sell at a premium to par value, and other bonds sell at a discount. What do you know about the relationship between the rate and the YTM for premium bonds? What about discount bonds? For bonds selling at par value?
c. What is the relationship between the current yield and YTM for premium bonds? For discount bonds? For bonds selling at par value?
Coupon
A coupon or coupon payment is the annual interest rate paid on a bond, expressed as a percentage of the face value and paid from issue date until maturity. Coupons are usually referred to in terms of the coupon rate (the sum of coupons paid in a...