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1. Suppose A-rated bonds were trading in the market at YTM of 5% on all maturities, and you bought an A-rated, 10-year, 4% coupon bond

1. Suppose A-rated bonds were trading in the market at YTM of 5% on all maturities, and you bought an A-rated, 10-year, 4% coupon bond with face value of $1,000 and annual coupon payments. Suppose that immediately after you bought the bond the yield on such bonds increased to 6% on all maturities and remains there until you sold the bond at your horizon date at the end of four years. What is your total return?

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