A four-year government bond makes annual coupon payments of 5.9% and offers a yield of 3.9% annually compounded.

a.

Suppose that one year later the bond still yields 3.9%. What return has the bondholder earned over the 12-month period?

b.	Suppose that the bond yields 2.9% at the end of the year. What return would the bondholder earn in this cant figure out b. for some reason