1. Call Premium A 7.00 percent corporate coupon bond is callable in ten years for a call premium of one year of coupon payments. Assuming a par value of $1,000, what is the price paid to the bondholder if the issuer calls the bond?
2. You’re trying to choose between two different investments, both of which have up-front costs of $94,000. Investment G returns $159,000 in 7 years. Investment H returns $279,000 in 14 years. Calculate the rate of return for each of these investments.
3. TIPS Interest and Par Value A 6.00 percent TIPS has an original reference CPI of 176.70. If the current CPI is 208.60, what is the current interest payment and par value of the TIPS? (Round your answers to 2 decimal places.)