1. A bond matures in 30 years, has a 20 year duration and a yield to maturity of 9.32%. The change in the level of the market interest rate is 0.47%. The modified duration is ________ and the percentage change in price is ________.
A) 9.4 years, -.47%
B) 14. Years, 4.7%
C) 18.29 years, -8.6%
D) 18.29 years, 8.6%
2. What is the tax-equivalent yield of a double tax-free 5% municipal bond if the investor is in the 28% federal and 7% state tax brackets?
A) 6.94%
B) 7.14%
C) 7.47%
D) 7.69%