more @ 60% Outlook 2:05 PM 18. Which of the following statements is (are) true for a risk averse investor? a. If two investment alternatives have equal returns, choose the one with lower risk. b. If two investment alternatives have equal risk, choose the one with lower return. c. Both of the above statements are true. d. Neither of the above statements are true. 19. If the yield-to-maturity of a bond is more than the coupon rate, the bond will sell at: a. a discount b. a premium c. par value d. its call price 20. A bond is selling for 95% of par and has an annual coupon rate of 6% and will mature in 5 years. There are semi-annual coupon payments. Calculate the yield-to-maturity on an annualized basis (APR). a. 10% b. 8.21% c. 7.21% d. 3.60% 21. Calculate the price of a six-year $1,000 face-value bond with a 7% annual coupon rate and a yield-to-maturity of 6% with semi-annual coupon payments. a. S1049 b. S1020 c. $980 d. $950 22. The discounted cash flow model for bonds: a. uses the coupon interest rate to discount bonds b. computes the future value of all cash flows c. uses the required rate of return to discount all promised bond cash flows d. is the present value of all coupon dividends