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CURRENT YIELD, CAPITAL GAINS YIELD, AND YIELD TO MATURITY Pelzer Printing

Inc. has bonds outstanding with $9$ years left to maturity. The bonds have a $9\%$ annual

coupon rate and were issued $1$ year ago at their par value of $$1,000.$ However, due to

changes in interest rates, the bond's market price has fallen to $$910\mathrm{.}30.$ The capital gains

yield last year was $-8\mathrm{.}97\%.$

a$.$ What is the yield to maturity?

b$.$ For the coming year, what are the expected current and capital gains yields? $($Hint:

Refer to footnote $7$ for the definition of the current yield and to Table $7\mathrm{.}1.)$

c$.$ Will the actual realized yields be equal to the expected yields if interest rates change?

If not, how will they differ?