Calculating current yield and return on investment. Assume that an investor pays $850 for a long-term bond that carries a 7.5 percent coupon. During the next 12 months, interest rates drop sharply, and the investor sells the bond at a price of $962.50.

a) Find the current yield that existed on this bond at the beginning of the year. What was it by the end of the 1-year holding period?

b) Calculate the return on this investment using the approximate yield formula and a 1-year investment period.

Please use excel and show functions so i can attempt to learn for myself. Thank you!