7. What are the relationships among coupon rate, current yield and yield

to maturity for a premium, discount and par bond?

8. Suppose a 6-month Treasury bill is priced with a yield on a bank discount

basis of 3.31%. The bill will mature in 181 days.

a. Assume the face value is $1,000, what is the bills dollar price?

b. What is the CD-equivalent yield?

c. What is the Treasury bills bond equivalent yield?

9. How does the Z-spread differ from the nominal spread?