Consider a five-year, default-free bond with annual coupons of

5%

and a face value of

$1,000

and assume zero-coupon yields on default-free securities are as summarized in the following table:

Maturity	1 year	2 years	3 years	4 years	5 years
Zero-Coupon Yields	4.00%	4.30%	4.50%	4.70%	4.80%

a. What is the yield to maturity on this bond?

b. If the yield to maturity on this bond increased to

5.20%,

what would the new price be?

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Part 1

a. What is the yield to maturity on this bond?

The yield to maturity on this bond is

enter your response here%.

(Round to three decimal places.)