A corporate bond is quoted at a price of 103.16 and carries a 5.20 percent coupon.

A corporate bond is quoted at a price of 103.16 and carries a 5.20 percent coupon. The bond pays interest semiannually. What is the current yield on one of these bonds?    A.  4.24 percent B.  5.04 percent C.  5.36 percent D.  5.62 percent E.  5.66 percent Current yield = (0.052 × $1,000)/(1.0316 × $1,000) = 5.04 percent

101.

A Treasury bond is quoted at a price of 106:23 with a 3.50 percent coupon. The bond pays interest semiannually. What is the current yield on one of these bonds?    A.  3.06 percent B.  3.19 percent C.  3.28 percent D.  3.33 percent E.  3.38 percent Current price = 106 and 23/32nds percent of face = 1.0671875 × $1,000 = $1,067.1875 Current yield = (0.035 × $1,000)/$1,067.1875 = 3.28 percent

102.	A Treasury bond is quoted as 99:18 asked and 99:09 bid. What is the bid-ask spread in dollars on a $5,000 face value bond?    A.  $0.03 B.  $0.63 C.  $11.00 D.  $14.06 E.  $16.25 Bid-ask spread = 99:18 - 99:09 = 9/32 of 1 percent of $5,000 = $14.06

103.	The semiannual, 8-year bonds of Alto Music are selling at par and have an effective annual yield of 8.6285 percent. What is the amount of each interest payment if the face value of the bonds is $1,000?    A.  $41.50 B.  $42.25 C.  $43.15 D.  $85.00 E.  $86.29