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Years to maturity 1 2 1 2 1 2 Number of coupon payment per year 1 1 1 Coupon rate 1 1 % 1 0

Years to maturity 121212
Number of coupon payment per year 111
Coupon rate 11%10%12%
Par value $1,000 $1,000 $1,000
Yield to maturity 11%11%11%
b. Calculating the price of each of the three bonds
Bond A Bond B Bond C
VB0 $1,000.00 $935.08 $1,064.92
c. Calculating the current yield for each of the three bonds
Bond A Bond B Bond C
Current yield 11.00%10.69%11.27%

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