Problem:
A bond has a $1000 par value, 10 years to maturity, and a 7% annual coupon adn sells for $985.
Requirement:
Question 1: What is its yield to maturity (YTM)?
Question 2: Assume that the yield to maturity remains constant for the next 3 years. What will the pricebe 3 years from today?
Note: Show supporting computations in good form.