Reference no: EM132787187

Marco Bond is a billionaire who wants to invest some of its petty cash in corporate bonds. You, as the hired financial planner of Marco, suggested the following bonds who all have a yield to maturity of 10% and matures in 15 years:

PCOR - 8% annual coupon rate; P1,000 face value
PGOLD - 10% annual coupon rate; P1,000 face value
PSE - 12% annual coupon rate; P1,000 face value

Problem 1.) If Marco Bond is interested in the periodic income from the bonds, between PGOLD and PSE which is better?

a. PSE because it has a lesser current yield than PGOLD

b. Indifferent since both of them has the same yield to maturity rate

c. PSE because it has a higher current yield than PGOLD

d. PGOLD because it has a greater current yield than PSE

Problem 2.) If Marco Bond is interested in the periodic income from the bonds, between PCOR and PSE which is better?

a. PSE because it has a greater current yield than PCOR

b. Indifferent since both of them has the same yield to maturity rate

c. PSE because it has a lesser current yield than PCOR

d. PCOR because it has a higher current yield than PSE