A semi-annual bond has a face value of $1,000, an annual coupon rate of 5.0%, has a yield to maturity of 9.0%, makes semi-annual coupon payments and has four years to maturity.

What is the price of this bond?

$868.08

If a bond with the above cash flows and maturity was trading in the market at $958 what would the yield-to-maturity (YTM) be?

$3.10

If the YTM of the bond described above remains constant (at 9%), how does the bond price change as we approach maturity?

What is the holding period return for each 6 months we hold the bond?