The bonds for Jeff Inc. are trading at a premium. What can be inferred from their existing bonds?

Multiple Choice

• None of the answers are correct.

• When the bonds were issued, the coupon rate was not set equal to the yield to maturity.

• Rates are now higher than when the bonds were issued.

• The company's default premium has been adjusted lower by the market.

• Rates are now lower than when the bonds were issued.