PART I:

Taylor Bros. bonds have a face value of $5,000, a current market price of $5,248.50, and a coupon rate of 5.3 percent, compounded semiannually. What is the current yield on these bonds?

A. 5.38%

B. 5.05%

C. 5.17%

D. 5.30%

E. 5.41%

PART II:

The 12-year bonds issued by Golf Companies have a quoted yield to maturity of 7.9 percent, a coupon rate of 8 percent, and semiannual payments. What is the effective annual yield on these bonds?

A. 7.90%

B. 7.97%

C. 8.06%

D. 8.00%

E. 8.16%