One-year Treasury bills currently earn 3.25 percent. You expect that one year from now, one-year Treasury bill rates will increase to 3.45 percent and that two years from now, one-year Treasury bill rates will increase to 3.95 percent. The liquidity premium on two-year securities is 0.05 percent and on three-year securities is 0.15 percent. If the liquidity theory is correct, what should the current rate be on three-year Treasury securities? 3.00 percent 3.62 percent 4.00 percent 3.95 percent A 6 percent corporate coupon bond is callable in 10 years for a call premium of one year of coupon payments. Assuming a par value of $1,000, what is the price paid to the bondholder if the issuer calls the bond? $1,060 $750 $700 $6,300 Calculate the current yield on an 7.45% coupon semi-annual corporate bond with a maturity of 10 years and a price of 93.01 ? 7.45 percent 8.01 percent 8.64 percent 4.00 percent