QUESTION 8 Lennar Company has 5 percent coupon bonds on the market with 10 years to maturity. The bonds make semiannual payments and currently sell for 98 percent of par. What is the capital gain yield if you hold the bond for one year? (Hint: you can find the current yield and the YTM, then solve for the capital gain yield. Alternatively, you can determine the price of the bond one year from today then determine the capital gain yield) -0.18% -0.12% 0.28% 0.22% 0.16% QUESTION 9 NCR Corporation wants to issue new 30-year bonds for some investment projects. The company currently has 6 percent coupon bonds on the market that sell for $934.37, make semiannual payments, and mature in 30 years. What coupon rate should the company set on its new bonds if it wants them to sell at par? 6.38% 6.50% 6.62% 6.74% 6.86% QUESTION 10 Pharmacia Company has a bond currently outstanding. The bond has a face value of $1,000 and matures in 10 years. The bond makes no coupon payments for the first three years, then pays $30 every six months over the subsequent four years, and finally pays $90 every six months over the last three years. If the required return on these bonds is 5.5% percent compounded semiannually, what is the current price of the bond? $981.33 $996.51 $1,033.82 $1,057.63 $1,098.37