A. A bonds market price is $950. It has a $1000 par value, will mature in 6 years, and has a coupon interest rate of 12 percent annual interest, but makes its interest payments semiannually. What is the bonds yield to maturity? What happens to the bonds yield to maturity if the bond matures in 12 years? What if it matures in 3 years ?

B. Fitzgeralds 15-years bonds pay 9 percent interest annually on a $1,000 par value. If the bonds sell at $945, what is the bonds yield to maturity? What would be the yield to maturity if the bonds paid interest semiannually? Explain the difference.

C. The saleemi corporations $1000 bonds pay 12 percent interest annually and have 15 years until maturity. You can purchase the bond for $1,075.

a. What is the yield to maturity on this bond?

b. Should you purchase the bond if the yield to maturity on a comparable-risk bond is 9 percent?