Below is a list of prices for zero-coupon bonds of various maturities.

Maturity (Years)	Price of $1,000 Par Bond (Zero-Coupon)
1	$943.40
2	873.52
3	816.37

a.	An 8.5% coupon $1,000 par bond pays an annual coupon and will mature in 3 years. What should the yield to maturity on the bond be? (Round your answer to 2 decimal places. Omit the "%" sign in your response.

What is the Yield to maturity %?

b.	If at the end of the first year the yield curve flattens out at 8%, what will be the 1-year holding-period return on the coupon bond? (Round your answer to 2 decimal places. Omit the "%" sign in your response.)

What is Holding-period return %?