1. Apisco Tiger Inc. has bonds outstanding with 9 years left to maturity. The bonds have a 6.5% annual coupon rate (coupons paid annually) and were issued 3 years ago at their par value of $1,000. However, due to changes in interest rates, the bond's market price has fallen to $975. What is the bond's yield to maturity today?
A. 6.09 percent B. 6.88 percent C. 6.57 percent D. 7.56 percent
2. A company wishes to raise $27 million by issuing 15-year semi-annual coupon bonds with face value of $1,000 and coupon rate of 6.60 percent. The bonds will have a yield to maturity of 7.70 percent. Determine the minimum number of these bonds the company needs to issue to raise the desired amount of money.
A. 52,803 B. 39,575 C. 36,590 D. 29,896