1- Bonds issued by Fairfax Mechanical were priced at 1,082.83 dollars six months ago and are priced at 1,070.88 dollars today. The bonds have a face value of 1,000 dollars, pay semi-annual coupons, and just made a coupon payment. The bonds had a percentage return over the past six months (from 6 months ago to today) of 6 percent. What is the coupon rate of the bonds? Answer as a rate in decimal format so that 12.34% would be entered as .1234 and 0.98% would be entered as .0098.
2- Arjen owns investment A and 1 bond B. The total value of his holdings is 2,836 dollars. Investment A is expected to pay annual cash flows to Arjen of 465.21 dollars per year with the first annual cash flow expected later today and the last annual cash flow expected in 6 years from today. Investment A has an expected return of 15.01 percent. Bond B pays semi-annual coupons, matures in 19 years, has a face value of $1000, has a coupon rate of 4.42 percent, and pays its next coupon in 6 months. What is the yield-to-maturity for bond B? Answer as a rate in decimal format so that 12.34% would be entered as .1234 and 0.98% would be entered as .0098.