A) The Wall Street Journal reports that the rate on 5-year Treasury securities is 6.45 percent and the rate on 6-year Treasury securities is 6.90 percent. The 1-year interest rate expected in five years is, E(₆r₁), is 7.50 percent. According to the liquidity premium hypotheses, what is the liquidity premium on the 6-year Treasury security, L₆? (Do not round intermediate calculations. Round your final answer to 2 decimal places.)

B) Calculate the price of a zero-coupon bond that matures in 25 years if the market interest rate is 5.0 percent. Assume semiannual compounding. (Do not round intermediate calculations and round your final answer to 2 decimal places.)

c) these answers are wrong

d) only looking for the "compute the yield to call portion"

e) Second part of the question wrong

Rank from highest credit risk to lowest risk the following bonds, with the same time to maturity, by their yield to maturity: (Rank: 1 = highest, 4 = lowest) 1 2 Treasury bond with yield of 4.80 percent IBM bond with yield of 6.24 percent Trump Casino bond with yield of 7.74 percent Banc One bond with a yield of 9.01 percent 3 4 A 4.40 percent coupon municipal bond has 10 years left to maturity and has a price quote of 97.95. The bond can be called in four years. The call premium is one year of coupon payments. (Assume interest payments are semiannual and a par value of $5,000.) Compute the bond's current yield. (Do not round intermediate calculations. Round your answer to 2 decimal places.) Current yield 4.49 % Compute the yield to maturity. (Do not round intermediate calculations. Round your answer to 2 decimal places.) Yield to maturity 4.66% Compute the taxable equivalent yield (for an investor in the 35 percent marginal tax bracket). (Do not round intermediate calculations. Round your answer to 2 decimal places.) Equivalent taxable yield 7.17% Compute the yield to call. (Do not round intermediate calculations. Round your answer to 2 decimal places.) Yield to call 5,220.00 % A corporate bond with a coupon rate of 6.9 percent has 15 years left to maturity. It has had a credit rating of BBB and a yield to maturity of 7.6 percent. The firm has recently gotten into some trouble and the rating agency is downgrading the bonds to BB. The new appropriate discount rate will be 8.9 percent. (Assume interest payments are semiannual.) What will be the change in the bond's price in dollars? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Round your final answer to 2 decimal places.) Change in bond price $ (101.83) What will be the change in the percentage? (Negative answer should be indicated by a minus sign. Do not round intermediate calculations. Round your final answer to 2 decimal places.) Change in bond percent (10.68) %