Bond B has 6 years to maturity, face value of 100, and a coupon rate of 3%; the bond pays coupons semi-annually. Market yield on similar securities is 2% per half year. You can buy bond B from a friend for $92.45. Should you do it?

a.

None of the above

b.

Yes, since $92.45 is lower than the bonds fair value.

c.

No, since $92.45 is higher than the bonds fair value.

d.

You are indifferent as the bond is fairly priced at $92.45.