1. You are an investor with a 5 year investment time period; preservation of your initial investment is a top priority. Which of the following is your optimum investment?

Group of answer choices

a. a Treasury bond that matures in 10 years

b. a AAA grade bond that matures in 5 years

c. a junk bond that matures in 5 years

2. What is the price of a 10-year bond with an annual coupon of 10% if the market rate of interest (the discount rate) is 13%? (The par value of the bond is $1,000.)

Group of answer choices

a. $943

b. $1134

c. $837

d. $723

3. What is the Yield-to-Maturity (YTM) on a 10-year, 9% annual coupon, $1,000 par value bond with a price of $887?

Group of answer choices

a. 9.00

b. 7.92

c. 11.88

d. 10.91

4. A 10-year, 10% semi-annual coupon bond with a price of $1,135.90 can be called in 4 years for $1,050. What is the yield-to-call?

Group of answer choices

a. 11.045%

b. 7.137%

c. 3.568%

d. 9.081%