onsider a five-year, default-free bond with annual coupons of

6%

and a face value of

$1,000

and assume zero-coupon yields on default-free securities are as summarized in the following table:

Maturity	1 year	2 years	3 years	4 years	5 years
Zero-Coupon Yields	5.00%	5.30%	5.50%	5.70%	5.80%

a. What is the yield to maturity on this bond?

b. If the yield to maturity on this bond increased to

6.20%,

what would the new price be?