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1. total 2 points) Consider a 5-year bond with a face value of $100 that pays interest semiannually at the rate of 4% per year
1. total 2 points) Consider a 5-year bond with a face value of $100 that pays interest semiannually at the rate of 4% per year (that is, 2% every six months). (a) (1/2 point) The current price of the bond is $100. What is the yield to maturity of the bond, assuming semi-annual compounding? (b) (1/2 point) Suppose the price of the 5-year bond in part (a) is now $93. What is the yield to maturity of the bond, assuming semi-annual compounding
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