Based on our in-class discussion, which one of the following statements is (are) correct?

I. To fight against the rising inflation driven by the COIVD-19 recovery, Fed has been establishing tightened monetary policy.

II. With the tapering program, the supply of the bonds will be lower, the bond yield will be higher.

II. Higher bond yield will induce higher firm borrowing costs. Under the discount cash flow framework, it will discount the firm future cash flow at a higher degree, which induces a lower firm value.