Bond A just paid a coupon. It matures in one year, has par value of $1000, pays coupons semiannually (so it has 2 more coupon payments left) and has a coupon rate of 6%. You know that it has a yield to maturity of 2%. 1. what would happen to the bond price if the YTM increases to 3%? 4%? 5%? 6%? 2. What would happen to the YTM if the price increases to $1050? $1100? 1150? 1200? 3. What is your realized return on the bond if you hold it until maturity and you do not reinvest the 4. What is your realized return on the bond if you hold it until maturity and you reinvest the coupons at 5. What is your realized return on the bond if you hold it until maturity and you reinvest the coupons at coupons? a rate of 1%? a rate of 2%? Suppose the YTM stays at 2%, you reinvest the first coupon at that rate and then sell the bond on Dec 31 2017. What is your HPR? Suppose the YTM increases to 3% (today), you reinvest the first coupon at that rate and then sell the bond on Dec 31 2017. What is your HPR? 6. 7