Yield to maturity. Each of the bonds shown in the following table pays interest annually.

Bond Par Value Coupon Interest Rate Years to Maturity Current Value

A $1,000 9% 8 $820

B 1,000 12% 16 1,000

C 500 12% 12 560

D 1,000 15% 10 1,120

E 1,000 5% 3 900

a. Calculate the yield to maturity (YTM) for each bond.

b. What relationship exists between the coupon interest rate and yield to maturity and the par value and market value of a bond? Explain.