Dont just report the answers. Show either Excel formula (or financial calculator) with number inputs or step by step solution using mathematical formula (where applicable).

1. (10 points) You are considering purchasing a bond with a 5.00% coupon interest rate (per year), a par value of $1,000, and a market price of $990. The bond will mature in 9 years.

a. What is the bonds current yield?

b. Calculate the bonds yield to maturity.