J&J Manufacturing issued a bond with a $1,000 par value. The bond has a coupon rate of 6% and makes payments semiannually. If the bond has 15 years remaining and the annual market interest rate is 7.2%, what will be bond sell for today?

V B = I N T ( 1 + r d ) t + M ( 1 + r d ) t ; P r i c e o f C a l l a b l e B o n d = I N T ( 1 + r d ) t + C a l l p r i c e ( 1 + r d ) t

Group of answer choices

$891.02

$789.12

$892.07

$1,435.93

Melissa Price bought a 15-year bond issued by Kroger five years ago for $1,064.28. The bond makes semiannual coupon payments at a rate of 8.5 percent. If the current price of the bonds is $1,083.64, what is the annual yield that Melissa would earn by selling the bond today? (Assume: Face value=$1,000)

Group of answer choices

4.14%

3.16%

8.29%

7.43%

6.32%

When a bond's yield to maturity is higher than the bond's coupon rate, the bond:

Group of answer choices

had to be recently issued.

is selling at a discount.

is selling at a premium.

has reached its maturity date.

is priced at par.