Consider the following $1.000 par value zero-coupon bonds: Bond A B C D Years to Maturity 1 2 3 4 YTM(%) 5.5% 6.5 7.0 7.5 According to the expectations hypothesis, what is the market's expectation of the yield curve one year from now? Specifically, what are the expected values of next year's yields on bonds with maturities of (a) one year? (b) two years? (c) three years? (Do not round Intermediate calculations. Round your answers to 2 decimal places.) Bond B Years to Maturity 1 YTM (%) 96 2 3 96 Below is a list of prices for zero-coupon bonds of various maturities. Maturity (Years) 1 2 3 Price of $1,eee Par Bond (Zero-Coupon) $978.14 876.92 843.70 a. A 4.6% 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.) Yield to maturity b. If at the end of the first year the yield curve flattens out at 6.5%, what will be the 1-year holding-period return on the coupon bond? (Round your answer to 2 decimal places.) Holding-period return 96 Consider the following $1.000 par value zero-coupon bonds: Bond A B C D Years to Maturity 1 2 3 4 YTM(%) 5.5% 6.5 7.0 7.5 According to the expectations hypothesis, what is the market's expectation of the yield curve one year from now? Specifically, what are the expected values of next year's yields on bonds with maturities of (a) one year? (b) two years? (c) three years? (Do not round Intermediate calculations. Round your answers to 2 decimal places.) Bond B Years to Maturity 1 YTM (%) 96 2 3 96 Below is a list of prices for zero-coupon bonds of various maturities. Maturity (Years) 1 2 3 Price of $1,eee Par Bond (Zero-Coupon) $978.14 876.92 843.70 a. A 4.6% 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.) Yield to maturity b. If at the end of the first year the yield curve flattens out at 6.5%, what will be the 1-year holding-period return on the coupon bond? (Round your answer to 2 decimal places.) Holding-period return 96