Prices and yields A six$-$year government bond makes annual coupon payments of $5\%$ and offers a yield of $3\%$ annually compounded. Suppose that one year later the bond still yields $3\%.$ P$\mathrm{.}1$: What return has the bondholder earned over the $12-$month period? P$\mathrm{.}2$: Now suppose that the bond yields $2\%$ at the end of the year. What return did the bondholder earn in this case?