7. (Related to Checkpoint 9.2 and Checkpoint9.3)(Bond valuation relationships)The 18-year, $1,000 par value bonds of Waco Industries pay 8 percent interest annually. The market price of the bond is $955, and themarket's required yield to maturity on a comparable-risk bond is 10 percent. a.Compute the bond's yield to maturity. b.Determine the value of the bond to you given the market's required yield to maturity on acomparable-risk bond. c.Should you purchase the bond? a.What is your yield to maturity on the Waco bonds given the current market price of thebonds? ____nothing% (Round to two decimal places.)

9. (Related to Checkpoint 9.6)(Inflationand interestrates) What would you expect the nominal rate of interest to be if the real rate is 4.3 percent and the expected inflation rate is7.2percent? The nominal rate of interest would be nothing ___%.(Round to two decimal places.)

(Related to Checkpoint 9.1)(Floating-rate loans)The Bensington Glass Company entered into a loan agreement with the firm's bank to finance the firm's working capital. The loan called for a floating rate that was 26 basis points( 0.26percent) over an index based on LIBOR. In addition, the loan adjusted weekly based on the closing value of the index for the previous week and had a maximum annual rate of 2.18 percent and a minimum of 1.78 percent. Calculate the rate of interest for weeks 2 through 10.

Date	LIBOR
Week 1	1.95%
Week 2	1.61%
Week 3	1.54%
Week 4	1.31%
Week 5	1.61%
Week 6	1.66%
Week 7	1.73%
Week 8	1.92%
Week 9	1.92%

The rate of interest for week 2 is

nothing%.

(Round to two decimal places.)