3. A financial manager facing a capital budgeting decision must decide whether to: A. issue stock or debt securities. 129 SOY B. use the money market or capital market. C. use primary markets or secondary markets. D. buy new machinery or repair the old. 4. Which one of the following must be correct for a bond currently selling at a premium? A. its coupon rate is variable. B. its current yield is lower than its coupon rate. C. its yield to maturity is higher than its coupon rate. D. its coupon rate is lower than the current market rate on similar bonds