- Consider 5-years bond with face value of $1'000 and coupon rate of 6%, paid semi-annually which is traded for a price of $1'030 one year after issue. What is its yield to maturity (YTM)? How do you call such a bond? - Assume that the above-mentioned note has a high credit rating and its risk premium is 0.5%. What can you say about risk-free interest rate for same period of investment on this market? - Assume that central bank increases its key interest rate to 6.5%. What will happen to the bond price? What will be its yield to maturity (YTM)? - Assume you invested in this bond at the date of issue and you were planning to keep the bond in mid- / -term perspective. What would be your actions in the case of central bank rate increase? - Consider 5-years bond with face value of $1'000 and coupon rate of 6%, paid semi-annually which is traded for a price of $1'030 one year after issue. What is its yield to maturity (YTM)? How do you call such a bond? - Assume that the above-mentioned note has a high credit rating and its risk premium is 0.5%. What can you say about risk-free interest rate for same period of investment on this market? - Assume that central bank increases its key interest rate to 6.5%. What will happen to the bond price? What will be its yield to maturity (YTM)? - Assume you invested in this bond at the date of issue and you were planning to keep the bond in mid- / -term perspective. What would be your actions in the case of central bank rate increase