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Author Question: If a bonds par value is less than its market price, which of the following can we reasonably state ... (Read 28 times)

Aimless0988

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on: Aug 7, 2023

Question 1

If 15-year T-bonds have a yield of 7.3%, 15-year corporate bonds yield 9.9%, the maturity risk premium on all 15-year bonds is 2.1%, and corporate bonds have a 0.6% liquidity premium versus a zero liquidity premium for T-bonds, what is the default risk premium on the corporate bond?

◦

1.75%


◦

1.90%


◦

2.00%


◦

2.36%



Question 2

If a bond’s par value is less than its market price, which of the following can we reasonably state about the general direction of interest rates in the recent past?

◦

Interest rates have risen.


◦

Interest rates have declined.


◦

Interest rates have remained relatively stable.


◦

None of the above are correct.

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Marked as best answer by Aimless0988 on Aug 7, 2023

Deonnak85

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Reply #1 on: Aug 7, 2023
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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Aimless0988

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Reply 2 on: Aug 7, 2023
Great answer, keep it coming :)

Jsherida

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Reply 3 on: Yesterday
YES! Correct, THANKS for helping me on my review

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