PowerPoint presentation. Be sure to include graphs, charts, and trends as appropriate. f. (1) The yield to maturity on a 10-year, 9% annual coupon, $1,000 par value bond that sells for $887.00 is 10.75%. The yield to maturity on the same bond that sells for $1,134.20 is 7.83%. The fact that a bond sells at a discount or at a premium tells us about the relationship between the bond's coupon rate and the prevailing interest rate. Explanation: If a bond sells at a discount, its coupon rate is lower than the prevailing interest rate. If a bond sells at a premium, its coupon rate is higher than the prevailing interest rate. (2) The total return for the discount bond is 9%, the current yield is 10.15%, and the capital gains yield is -1.15%. The total return for the premium bond is 9%, the current yield is 7.93%, and the capital gains yield is 1.07%