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(Yield to maturity) The Saleemi Corporation's $1,000 bonds pay 7 percent interest annually and have 9 years until maturity. You can purchase the bond for

(Yield to maturity) The Saleemi Corporation's $1,000 bonds pay 7 percent interest annually and have 9 years until maturity. You can purchase the bond for $1,095.

a.What is the yield to maturity on this bond?

b.Should you purchase the bond if the yield to maturity on a comparable-risk bond is 7 percent?

Part 1

a.The yield to maturity on the Saleemi bonds is %

(Round to two decimal places.)

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