1. Suppose you hold a bond, and the current one year holding period rate of return is 6%. And we further know that the yield to maturity for this bond is also 6% now. Could you tell me which rate will be higher if the interest rate decreases? Why?

2. Suppose there are two bonds with the same yield to maturity and date to mature; but one is sold at premium, the other one is sold at discount. Could you tell me which bond has a higher coupon? Why?

3. Is there any difference in prices between these two bonds mentioned in question number 2 at the end of their duration? Why?