Question: 1a- What is the current yield on a zero coupon bond with a remaining life of 7 years, a yield to maturity of 10.3%, and

1a- What is the current yield on a zero coupon bond with a remaining life of 7 years, a yield to maturity of 10.3%, and a par value of $1000? (Round to 100th of a percent and enter as a percentage, e.g. 12.34% as 12.34 and state as an annual rate.)

ANSWER:

1b- What is the most we should pay for a bond with a par value of $1000, coupon rate of 3.3% paid annually, and a remaining life of 29 years? The yield to maturity is 4.9%. Assume annual discounting. (Round your answer to the nearest penny.)

ANSWER:

1c- Mickey and Minnie just bought a zero coupon bond for $475.20, but they cannot recall when it matures. The yield to maturity equals 6.7%. Can you help Mickey and Minnie? The bond's face value is $1000. (Assume annual discounting) (Enter your answer in years and round to 2 decimal places.)

ANSWER:

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