1. A $100,000, 8.75% bond with interest payable semi-annually is redeemable at 103 in four years. What is the purchase price to yield 7% compounded semi-annually?

a.

$105,748.62

b.

$108,292.95

c.

$106,548.82

d.

$107,584.62

e.

$107,548.62

2. A $10,000, 6.2% bond with quarterly coupons redeemable at par is purchased 9 years before maturity to yield 6% compounded quarterly. Determine the premium or discount.

a.

$144.88

b.

$137.54

c.

$469.14

d.

$138.30

e.

$530.86