Question: 2. What would be the initial offering price for the following bonds ( assume semiannual compounding)? a. A 15- year zero- coupon bond with a

2. What would be the initial offering price for the following bonds ( assume semiannual compounding)? a. A 15- year zero- coupon bond with a yield to maturity ( YTM) of 12 percent b. A 20- year zero- coupon bond with a YTM of 10 percent

3. Why does the present value equation appear to be more useful for the bond investor than for the common stock investor?

4. What are the important assumptions made when you calculate the promised yield to maturity? What are the assumptions when calculating promised YTC?

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