A $10,000 bond can be redeemed for $10,450 in 10 years has coupons payable semi-annually. The book value adjustment (write-down) for the 4th coupon is $22.40 and the book value adjustment (write-down) for the 5th coupon is $23.24.

Which of the following statements is/are true?

(i) The bond was purchased at a premium

(ii) The bond was purchased at a price to yield j₂ = 7.5%

(iii) The price that was paid for this bond cannot be determined

• A.

  All but (iii).

• B.

  All but (i).

• C.

  All statements are true.

• D.

  All but (ii).