1. A 13-year bond of a firm in severe financial distress has a coupon rate of 14% and sells for $930. The firm is currently renegotiating the debt, and it appears that the lenders will allow the firm to reduce coupon payments on the bond to one-half the originally contracted amount. The firm can handle these lower payments. What are the stated and expected yields to maturity of the bonds? The bond makes its coupon payments annually. (Do not round intermediate calculations. Round your answers to 2 decimal places.)

Stated yield to maturity	_____%???
Expected yield to maturity	7.81%
btw, stated yield to maturity isn't 15.07

2. A two-year bond with par value $1,000 making annual coupon payments of $90 is priced at $1,000.

a. What is the yield to maturity of the bond? (Round your answer to 1 decimal place.)

Yield to maturity _90_%

b. What will be the realized compound yield to maturity if the one-year interest rate next year turns out to be (a) 7.0%, (b) 9.0%, (c) 11.0%? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Interest Rate Realized YTM

Interest Rate	Realized YTM
7.0%	_____%???
9.0%	_____%???
11.0%	_____%???