A corporate bond ($1,000 par value) with a 7% coupon, paid semi-annually, is rated BBB. It is currently trading in the secondary market for $965. Currently, the nominal risk-free rate is 4%.

The bond is selling at:

		a discount
	a premium

		par value
	face value

Since the bond was issued, interest rates have:

	remained the same
		declined

		increased
	It can not be determined from the information given.

Is the bond investment-grade?

	Yes, because it is BBB- or above
		No, because it is BBB or lower.

	No, because it is lower than A-.
		Yes, because it is above C-.

If you buy this bond, how much interest in $ will you receive each year from the issuer?

	$140
		$35

		$70
	It can not be determined from the information given.

What is the bonds current yield?

	7.00%
	3.63%

		7.25%
	It can not be determined from the information given.