Regarding the changing yields, remember when a bond sells at par, the nominal yield, current yield, and the yield to maturity are equal. If you are asked to rank bonds in their order of yield when the bonds are not selling at par, always begin with the nominal yield. Then, when the price changes — either down to a discount or up to a premium — the current yield, YTM, and YTC will change inversely; the current yield will move the least amount, the YTC will move the most, and the YTM will be between current and YTC. Thus:
•The order of all four yields will be: N, C, B, M, C — Nominal, Current, Basis, YTM, YTC.