1. A $$5,000 bond with a coupon rate of 5.8% paid semiannually has tenten years to maturity and a yield to maturity of 7%. If interest rates rise and the yield to maturity increases to 7.37.3 %, what will happen to the price of the bond?
A. fall by $ 99.43$ B. fall by $ 119.32 C. rise by $ 99.43$ D. The price of the bond will not change.
2. The Sisyphean Company has a bond outstanding with a face value of $1,000 that reaches maturity in15 years. The bond certificate indicates that the stated coupon rate for this bond is 8.5 and that the coupon payments are to be made semiannually. Assuming the appropriate YTM on the Sisyphean bond is 7.7, then this bond will trade at
A. par.
B. a premium.
C. a discount.
D. none of the above