In an era of particularly low interest rates

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Reference no: EM131551219

A. In an era of particularly low interest rates, which of the following bonds is most likely to be called?

a) Zero-coupon bonds

b) Coupon bonds selling at a discount

c) Coupon bonds selling at a premium

d) Floating-rate bonds

B. A coupon bond that pays interest of $60 annually has a par value of $1,000, matures in 5 years, and is selling today at a $75.25 discount from par value. The current yield on this bond is _________.

C. A coupon bond that pays interest semiannually has a par value of $1,000, matures in 8 years, and has a yield to maturity of 6%. If the coupon rate is 7%, the intrinsic value of the bond today will be __________.

Reference no: EM131551219

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