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Part 1: Buying Bonds You are evaluating two different bonds for investment purposes. Both bonds have 5-year maturities and the same credit rating and face

Part 1: Buying Bonds

You are evaluating two different bonds for investment purposes. Both bonds have 5-year maturities and the same credit rating and face value. Bond A is selling at $1,389 and pays a coupon of $50 each quarter. Bond B is selling at $781 and pays a $10 coupon each quarter. Fill out the table below and explain which bond is a better choice.

N

I/Y

PV

PMT

FV

Part 2: Mutual Funds

What are some arguments for why a mutual fund is better than an Exchange-Traded Fund (ETF)? What are some of the arguments for why an ETF is better than a mutual fund?

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