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6) (3 pts) You buy one hundred $1000 face value bonds that mature in 3 years, pay a 7.5% annual coupon and are priced at
6) (3 pts) You buy one hundred $1000 face value bonds that mature in 3 years, pay a 7.5% annual coupon and are priced at $980. a. What is the Yield to maturity of these bonds? YTM = b. What is your realized compound yield if hold the bond to maturity and you reinvest the coupons at the following rates: Year 1 coupon is re-invested in a 2 year CD paying 2.5% Year 2 coupon is re-invested in a 1 year CD paying 2.0% Realized compound Yield =
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