Global Satellite Corp. issues twelve$-$year, AA$-$rated bonds. What is the yield on one of these bonds? $($Hint: Disregard cross$-$product terms; that is$,$ if

averaging is required, use an arithmetic average.$)$

$8\mathrm{.}25\%$

$7\mathrm{.}15\%$

$7\mathrm{.}75\%$

$5\mathrm{.}20\%$

Based on your understanding of the determinants of interest rates, if everything else remains the same, which of the following will be true?

In theory, the yield on a bond with a longer maturity will be higher than the yield on a bond with a shorter maturity.

The yield on a AAA$-$rated bond will be higher than the yield on a BB$-$rated bond.