Jason Santiago & Dan Ni Limited issued a new series of 15 years, 8% annual coupon bonds on January 1, 2010. The bonds were issued at $1194.24 each.

a. What was the yield to maturity of the bonds on January 1, 2010?

b. What was the price of the bonds on January 1, 2015 (5 year later) assuming the required rate of return is 7%?

c. Find the current yield and the capital gain yield if Timothy Yeung purchases the bond on January 1, 2015, and sell it on January 1, 2016. Assume required rate of return will stay at 7%.

d. Suppose Noorin Moledina bought the bond on January 1, 2010 and sold it on January 1, 2020 for $939.06. What was the annual holding period return? Compare this yield to YTM when you first bought the bond. Why are they different?