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Simon Pause Corporation bonds have a zero-coupon rate, mature in ten years, and have a current yield to maturity of 5% annual rate, compounded semiannually.

Simon Pause Corporation bonds have a zero-coupon rate, mature in ten years, and have a current yield to maturity of 5% annual rate, compounded semiannually.

a. What is the price per $100 of face value of Simon Pause Corporation bonds?

b. Suppose in three years the market price of the bond is 66.11178 per $100 of face value. What will the yield to maturity be at that time?

c. Suppose you purchased the Simon Pause bond today and sold the bonds in three years for 66.11178 per $100 of face value. What is your holding period yield for this investment?

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