The Government of the Republic of Indonesia plans to issue new SBN. SBN are securities issued by the government to finance the state budget and can be an investment instrument for holders (investors) because they can provide returns or profits. The following is data for one SBN as follows: coupon 15% p.a. will be paid annually, face value @ IDR 20,000,000,- and fall future 5 years.

a) This bond is marketed at an exchange rate of 95, what yield will you get if you invest in this bond? assuming a tax rate of 20%

b) In your opinion, the above bonds are marketed at a premium or at a discount? What's the difference?

c) Explain the difference between SBN bonds (ORI) and corporate bonds?