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Locate the Treasury bond in Figure 7.5 maturing in August 2027. 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 2027. 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.) premium a. Premium or discount bond b. Current yield c. Yield to maturity d. Bid-ask spread % % FIGURE 7.5 Sample Wall Street Journal U.S. Treasury Note and Bond Prices Treasury Notes and Bonds Bid Asked Yield 1.649 Maturity 5/15/2020 12/31/2020 9/30/2021 4/30/2022 12/31/2022 Coupon 8.75 2.5 1.125 1.661 103.18 100.294 98.304 100.05 101.096 Chg -0.022 -0.006 0.102 0.008 0.002 1.75 2.125 1/31/2023 100.042 3/31/2023 7/31/2023 1.75 2.5 1.25 102.194 98.114 0.006 0.002 0.004 -0.006 0.004 2 2 2.5 101.036 101.066 103.202 106.212 130.2 132.17 -0.004 Asked 103.184 100.3 98.31 100.054 101.102 100.046 102 98.12 101.042 101.072 103.206 106.216 130.21 132.18 105.306 134.16 132.25 141.24 136.046 119.234 135.054 123.25 106.114 1.684 1.679 1.69 1.702 1.698 1.703 1.735 1.719 1.765 1.814 1.821 1.85 1.919 1.947 2.108 2.131 2.182 3 6.5 4/30/2024 5/31/2024 1/31/2025 10/31/2025 11/15/2026 8/15/2027 2/15/2029 2/15/2031 2/15/2036 2/15/2037 5/15/2038 2/15/2039 5/15/2040 8/15/2041 8/15/2042 6.375 105.296 2.625 5.375 4.5 134.14 132.23 5 141.22 4.5 3.5 4.375 3.75 2.233 -0.002 -0.030 -0.022 -0.008 -0.036 -0.770 -0.094 -0.074 -0.076 -0.078 -0.786 -0.080 -0.082 -0.760 -0.094 135.026 119.214 134.034 123.23 106.094 2.28 2.75 2.348 2.386 2.391 106.082 106.102 11/15/2042 2/15/2043 5/15/2043 2.75 3.125 113 113.02 2.39 2.875 108.152 1008.172 2.398

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