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Locate the Treasury bond in Figure 7.5 maturing in August 2042. Assume a $10,000 par value. a. Is this a premium or a discount bond?

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Locate the Treasury bond in Figure 7.5 maturing in August 2042. Assume a $10,000 par value. a. Is this a premium or a discount bond? b. What is its current yield? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) c. What is its yield to maturity? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) d. What is the bid-ask spread in dollars? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) FIGURE 7.5 Sample Wall Street Journal U.S. Treasury Note and Bond Prices Treasury Notes and Bonds Asked Yield Bid Asked Maturity 5/15/2020 Coupon 8.75 Chg -0.022 103.18 103.184 1.649 12/31/2020 2.5 100.294 100.3 -0.006 1.661 9/30/2021 1.125 98.304 98.31 0.102 1.684 1.75 100.054 0.008 1.679 4/30/2022 12/31/2022 100.05 101.096 2.125 101.102 0.002 1.69 1.75 100.042 100.046 0.006 1.702 1/31/2023 3/31/2023 2.5 102.194 102 0.002 1.698 7/31/2023 1.25 98.114 98.12 0.004 1.703 4/30/2024 2 101.036 101.042 -0.006 1.735 5/31/2024 2 101.066 101.072 0.004 1.719 1/31/2025 2.5 103.202 103.206 -0.004 1.765 3 106.212 106.216 -0.002 1.814 10/31/2025 11/15/2026 6.5 130.2 130.21 -0.030 1.821 8/15/2027 6.375 132.17 132.18 -0.022 1.85 2.625 105.296 105.306 -0.008 1.919 2/15/2029 2/15/2031 2/15/2036 -0.036 5.375 4.5 134.14 132.23 134.16 132.25 1.947 2.108 -0.770 2/15/2037 5 141.22 141.24 -0.094 2.131 5/15/2038 4.5 135.026 136.046 -0.074 2.182 2/15/2039 3.5 119.214 119.234 -0.076 2.233 5/15/2040 4.375 134.034 135.054 -0.078 2.28 8/15/2041 3.75 123.23 123.25 -0.786 2.348 8/15/2042 2.75 106.094 106.114 -0.080 2.386 11/15/2042 2.75 106.082 106.102 -0.082 2.391 2/15/2043 3.125 113 113.02 -0.760 2.39 2.875 108.152 1008.172 -0.094 2.398 5/15/2043 8/15/2044 3.125 113.116 113.136 -0.078 2.402

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