1. Wine and Roses, Inc. offers a 6.0 percent coupon bond with semi annual payments and a yield to maturity of 6.91 percent. The bonds mature in 12 years. What is the market price of a $1,000 face value bond?
$1,410.62
$1,442.55
$926.59
$1,023.89
$1,484.04
2. The Lo Sun Corporation offers a 6.0 percent bond with a current market price of $788.50. The yield to maturity is 8.40 percent. The face value is $1,000. Interest is paid semi annually. How many years is it until this bond matures?
31.44 years
26.28 years
16.38 years
8.19 years
32.77 years
3. A bond that pays interest annually yields a rate of return of 6.75 percent. The inflation rate for the same period is 2 percent. What is the real rate of return on this bond?
2.00 percent
4.66 percent
8.75 percent
3.38 percent
1.05 percent