6. You have $500,000 available to invest. The risk-free rate, as well as your borrowing rate, is 8%. The return on the risky portfolio is 16%. If you wish to earn a 22% return, you should A) Invest $125,000 in the risk-free asset B) Invest $375,000 in the risk-free asset C) Borrow $125,000 D) Borrow $375,000 E) None of the above 7. Assume you have a 7-year bond with a 9% coupon and a yield to maturity of 12%. If interest rates remain constant, one year from now the price of this bond will be: A) Higher B) Lower C) The same D) Indeterminate E) None of the above 8. The bond will sell at a premium to par when: A) its coupon rate is greater than its yield to maturity B) its coupon rate is less than its yield to maturity C) its coupon rate is equal to its yield to maturity OD) its coupon rate is less than its conversion value