5. Bond yields and prices over time A bond investor is analyzing the following annual coupon bonds: Annual Coupon Rate Issuing Company Smith Corporation 6% Irwin Incorporated 12% Johnson, LLC 9% Each bond has 10 years until maturity and the same level of risk. Their yield to maturity (YTM) is 9%. Interest rates are assumed to remain constant over the next 10 years. BOND VALUE ($1 1200 1100 B 1000 900 C 800 700 600 10 8 6 2 YEARS TO MATURITY Using the previous information, correctly match each curve on the graph to it's corresponding issuing company. (Hint: Each curve indicates the path that each bond's price, or value, is expected to follow.) Curve A Curve B Curve C Based on the preceding information, which of the following statements are true? Check all that apply. Irwin Incorporated's bonds have the highest expected total return. The current yield for Irwin Incorporated's bonds is between 0% and 9%. The current yield for Irwin Incorporated's bonds is greater than 9%. Johnson, LLC's bonds are selling at par. If a bond is selling for a price much lower than its par value, it is most likely that the bond is bond. 5. Bond yields and prices over time A bond investor is analyzing the following annual coupon bonds: Annual Coupon Rate Issuing Company Smith Corporation 6% Irwin Incorporated 12% Johnson, LLC 9% Each bond has 10 years until maturity and the same level of risk. Their yield to maturity (YTM) is 9%. Interest rates are assumed to remain constant over the next 10 years. BOND VALUE ($1 1200 1100 B 1000 900 C 800 700 600 10 8 6 2 YEARS TO MATURITY Using the previous information, correctly match each curve on the graph to it's corresponding issuing company. (Hint: Each curve indicates the path that each bond's price, or value, is expected to follow.) Curve A Curve B Curve C Based on the preceding information, which of the following statements are true? Check all that apply. Irwin Incorporated's bonds have the highest expected total return. The current yield for Irwin Incorporated's bonds is between 0% and 9%. The current yield for Irwin Incorporated's bonds is greater than 9%. Johnson, LLC's bonds are selling at par. If a bond is selling for a price much lower than its par value, it is most likely that the bond is bond