1. A bond sold five weeks ago for $1,100. The bond is worth $1,150 in todays market. Assuming no changes in risk, which of the following is true?

a. The bond has a smaller premium today than it did five weeks ago.

b. Interest rates must be lower now than they were five weeks ago.

c. The bonds current yield has increased from five weeks ago.

d. The coupon payment of the bond must have increased.

2. For a discount bond, the current yield is __ the coupon rate, and the coupon rate is _____ the yield to maturity.

a. less than; less than

b.less than; greater than

c. greater than; less than

d.greater than; greater than