4. The yield curve is upward sloping. Here are characteristics of a bond you bought today: N=10,I/Y=1.5%,PV=$1,000,PMT=$30,FV=$1,000 The current 4yrI/Y is 1.25% Assume the yield curve is exactly the same in 1yr and you liquidate at that time for the fundamental value of the bond What is your total return percentage *Assume interim cashflow is reinvested at 1.5%I/Y 4. The yield curve is upward sloping. Here are characteristics of a bond you bought today: N=10,I/Y=1.5%,PV=$1,000,PMT=$30,FV=$1,000 The current 4yrI/Y is 1.25% Assume the yield curve is exactly the same in 1yr and you liquidate at that time for the fundamental value of the bond What is your total return percentage *Assume interim cashflow is reinvested at 1.5%I/Y