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A year ago, Elena bought a Spanish government bond for 1,020 (Euro) with a 5% coupon. Over the course of the next 12 months, interest

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A year ago, Elena bought a Spanish government bond for 1,020 (Euro) with a 5% coupon. Over the course of the next 12 months, interest rates drop sharply. As a result, she sells the bond at the current price of 1,100. a. Find the current yield that existed on this bond one year ago and today. b. Calculate the HPR return in euros for Elena. (See Chapter 5 for HPR formula.)

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