10. Inflation and Nominal Returns. Suppose the real rate is 1.9 percent and the inflation rate is 3.4 percent. What rate would you expect to see on a Treasury bill? 2 14. Using Treasury Quotes. Locate the Treasury bond in Figure 6.3 maturing in February 2037. Is this a premium or a discount bond? What is its current yield? What is its yield to maturity? What is the bid-ask spread for a $1,000 par value bond? TOUT 22. Bond Yields. LO 2 BDJ Co. wants to issue new 25-year bonds for some much- needed expansion projects. The company currently has 5.6 percent coupon bonds on the market that sell for $1,074, make semiannual payments, have a $1,000 par value, and mature in 25 years. What coupon rate should the company set on its new bonds if it wants them to sell at par? 23 Accrued Intorect 02 25. Using Bond Quotes. Suppose the following bond quote for IOU Corporation appears in the financial page of today's newspaper. Assume the bond has a face value of $1,000, and the current date is April 15, 2016. What is the yield to maturity of the bond? What is the current yield? Company (Ticker) Coupon Maturity Last Price Last Yield EST Vol (000s) IOU (IOU) 8.50 Apr 15, 2031 91.645 ?? 1,827 ART 4 Valuing Stocks and Bonds LO 2 28. Bond Yields. In the table, find the Treasury bond that matures in May 2027. What is your yield to maturity if you buy this bond