Question 1

It is possible that zero-coupon bonds sells at a premium?

A. True

B. False

Question 2

The Sisyphean Company has a bond outstanding with a face value of $1000 that reaches maturity in 5 years. The bond certificate indicates that the stated coupon rate for this bond is 10.0% and that the coupon payments are to be made semiannually. Assuming the appropriate YTM on the Sisyphean bond is 7.5%, then this bond will trade at _____?

A. par

B. a premium

C. non of the above

D. a discount