Bonds of Zello Corporation with a par value of $1,000 sell for $960, mature in five years, and have a 7% annual coupon rate paid semiannually. Calculate the:
a. Current yield.
b. Yield to maturity.
A) a. 7.29%; b. 7.64%
B) a. 7.50%; b. 7.86%
C) a. 7.64%; b. 7.29%
D) a. 7.86%; b. 7.50%