Question 7 (10 points): Jerome Powell is managing a portfolio of U.S. bonds. Given the U.S. yield curve as seen below: Treasury Yield Curve Nov. 2020 = 2% Which one of the 4 bonds below should Jerome SELL and more importantly WHY? (all bonds have semi-annual compounding assumptions) 1.75% 1.5% Bond A has 30% coupon rate, 2.5 years to maturity, 25% yield to maturity, and a $1,000 par value. 1.25% Treasury yield % 1% Bond B has 0% coupon rate, 2 years to maturity, 2% yield to maturity, and a $1,000 par value. 0.75% Bond C has 20% coupon rate, 2.5 years to maturity, 25% yield to maturity, and a $1,000 par value. 0.5% 0.25% Bond D has 10% coupon rate, 2 years to maturity, 2% yield to maturity, and $1,000 par value. 0% to 1 1Y zoy 1M 10Y 3M 2Y 7Y & 30, Question 7 (10 points): Jerome Powell is managing a portfolio of U.S. bonds. Given the U.S. yield curve as seen below: Treasury Yield Curve Nov. 2020 = 2% Which one of the 4 bonds below should Jerome SELL and more importantly WHY? (all bonds have semi-annual compounding assumptions) 1.75% 1.5% Bond A has 30% coupon rate, 2.5 years to maturity, 25% yield to maturity, and a $1,000 par value. 1.25% Treasury yield % 1% Bond B has 0% coupon rate, 2 years to maturity, 2% yield to maturity, and a $1,000 par value. 0.75% Bond C has 20% coupon rate, 2.5 years to maturity, 25% yield to maturity, and a $1,000 par value. 0.5% 0.25% Bond D has 10% coupon rate, 2 years to maturity, 2% yield to maturity, and $1,000 par value. 0% to 1 1Y zoy 1M 10Y 3M 2Y 7Y & 30