1. A 10-year, 5% semiannual coupon bond, with a par value of $1,000 is 1 year old, and may be called in another 3 years at a call price of $1,045. Assume you purchase this bond today for $1.080. What is the nominal yield to call?
a. 2.27 percent
b. 3.60 percent
c. 4,07 percent
d. 4.53 percent
2. Assume that Margie Perez wishes to purchase a 20 year bond with 14 years left to maturity that has a maturity value of $1,000 and makes semiannual interest payments of $30. If she requires a 10 percent nominal yield to maturity on this investment, what should be the price she is willing to pay for the bond?
a. $851,02
b. $776,53
c. $702.04
d. $441.61