Suppose a 10-year,

$1,000

bond with an

8.5%

coupon rate and semi-annual coupons is trading for a price of

$1,035.54.

a. What is the bond's yield to maturity (expressed as an APR with semi-annual compounding)?

b. If the bond's yield to maturity changes to

9.4%

APR, what will the bond's price be?

Question content area bottom

Part 1

a. What is the bond's yield to maturity (expressed as an APR with semi-annual compounding)?

The bond's yield to maturity is

enter your response here%.

(Round to two decimal places.)

Part 2

b. If the bond's yield to maturity changes to

9.4%

APR, what will the bond's price be?

The new price for the bond will be

$enter your response here.

(Round to the nearest cent.)