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Felter Printing Inc, has bonds outstanding with 19 years left to maturity. The bonds have a 7 th annual coupon rate and were issued 1

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Felter Printing Inc, has bonds outstanding with 19 years left to maturity. The bonds have a 7 th annual coupon rate and were issued 1 year ago at their par value of to changes in interest rotes, the bond's market price has falien to $890.20. The capital gains yield last year was 10.98%. a. What is the yeld to muturity? oo not round ifiemediate calculations. flound your answer to two decimal places. b. For the coming vear, what are the expected current and capital gains velds? (Hink: Refer to Footnote 6 for the definition of the current vield and to Table 7.1 ) O Dot round For termediate calculations. Flound vour aniwers to two decimal places. Expected current vieli: Expected captal gains yeld: C. Wilt the sctual realired vielas be edial to the expected yelds if imterest rates change? If not, how will they differ? 1. As long as promius coupon parments are mode, the current yield will change as a result of changing interest rates, However, changing rates all cause the price to II. As long as promused coupon perments ave made, the current ylels will not change as a result of changing interest rates. However, changing rates will cause the price II. As long as promised coupen parenents are made, the current veld will change as a result of changing interest rates. However, changing rates wil cause the prion to difer from the VTM

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