Answer:
This question is incomplete. However I found the full question on the web that it is asking for rate of return if the yield to maturity at the end of the year is 6%. It is calculated as follows;
Explanation:
In one year, the time left to maturity is 1 year since this is a 2-year maturity bond.
Rate of return formula = (P1 + Coupon - P0) /P0
whereby P1 = Next year's price
P0 = current price
P1 = (102 + 1000) /1.06
P1 = 1039.62
P0 = 1000 ( this is given in the question)
Rate of return = (1039.62 + 102 - 1000)/1000
= 141.62 / 1000
= 0.14162 or 14.16% as a percentage
