If a bond's yield to maturity does not change, the return on the bond each year will be equal to the yield to maturity. Confirm this for both a premium and a discount bond using a 4-year 4.0 percent coupon bond with annual coupon payments and a face value of $1,000.

1. Assume the yield to maturity is 3.0 percent.
2. Assume the yield to maturity is 5.0 percent.

• Required A
• Required B

Assume the yield to maturity is 3.0 percent. (Do not round intermediate calculations. Enter "Bond price" answers to 2 decimal places and "Rate of return" rounded to 1 decimal place.)

Bond price today
Bond price in one year
Rate of return		%

• Complete this question by entering your answers in the tabs below.

• Required A
• Required B

• Assume the yield to maturity is 5.0 percent. (Do not round intermediate calculations. Enter "Bond price" answers to 2 decimal places and "Rate of return" rounded to 1 decimal place.)

  Bond price today
  Bond price in one year
  Rate of return		%