2. (Bondholders' expected rate of return) You own a bond that has a par value of $1,000 and matures in 11 years. It pays an annual coupon rate of 9

percent. The bond currently sells for $825. What is the bond's expected rate of return? The bond's expected rate of return is nothing%. (Round to two decimal places.)

3. (Bond valuationzero coupon) The Latham Corporation is planning on issuing bonds that pay no interest but can be converted into $1,000 at maturity, 4 years from their purchase. To price these bonds competitively with other bonds of equal risk, it is determined that they should yield 8 percent, compounded annually. At what price should the Latham Corporation sell these bonds? The price of the Latham Corporation bonds should be $nothing. (Round to the nearest cent.)