Consider the following $1000 par value zero-coupon bonds issued by the same company:

Bond Years to Maturity. Yield to Maturity

A. 1 6.00%

B 2 7.50%

C 3 7.99%

D 4 8.49%

E 5 10.70%

You just purchased a bond from the same company that pays a 4% annual coupon and matures in 5 years. As shown in the table, the current required yield to maturity on this bond is 10.70%.

3. What will be the price of the bond when you sell is at the end of year three?

4. What is the holding period return you will receive on this bond?