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Yield to maturity: The bond shown in the following table pays interest annually. Par value Coupon interest rate Years to maturity Current value $500 5%

Yield to maturity:The bond shown in the following table pays interest annually.

Par value Coupon interest rate Years to maturity Current value

$500 5% 5 $470

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

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