NEED JUST ANSWERS TO DOUBLE CHECK WHAT I HAVE :

QUESTION 2

Consider the following two bonds:

	Bond A	Bond B
Maturity	15 yrs	20 yrs
Coupon Rate (Paid semiannually)	10%	6%
Par Value	$1,000	$1,000

Suppose the yield the maturity for both bonds is 8%. Which bond is a premium bond, and which is a discount bond?

		A. Bond A is premium; Bond B is discount
		B. Bond B is premium; Bond A is discount
		C. Bond A is premium; Bond B is also premium
		D. Incomplete information

QUESTION 3

For the bonds described above, suppose required rate of return (i.e. yield to maturity) is 10%. Which bond will sell at par, premium, or discount?

		A. Bond A will sell at par
		B. Bond B will sell at par
		C. Both bonds A and B will sell at par
		D. Bond A will sell at a premium
		E. Bond B will sell at a premium
		F. Both bonds will sell at a discount

QUESTION 4

Suppose Bond B is selling at 15 percent below par. Calculate this bond's yield to maturity. Recall that both bonds pay interest semiannually.

		A. 3.73%
		B. 3.85%
		C. 8.223%
		D. 7.455%
		E. None of the above

QUESTION 5

The yield on a corporate bond is 10% and it is currently selling at par. The marginal tax rate is 20%. A par value municipal bond with a coupon rate of 8.50% is available. Which security is a better buy?

		A. The municipal bond offers a lower after-tax yield given the marginal tax rate, so the corporate bond is a better buy
		B. Both bonds have the same after-tax yield. You should therefore be indifferent
		C. The corporate bond offers a lower after-tax yield given the marginal tax rate, so the municipal bond is a better buy
		D. None of the above