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  3. 5. a treasury bond due in one year has a yield of

5. A Treasury bond due in one year has a yield of 5.7%; a Treasury...

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5. A Treasury bond due in one year has a yield of 5.7%; a Treasury bond due in 5 years has a yield of 6.2%. A bond issued by Ford Motor Company due in 5 years has a yield of 7.5%; a bond issued by Shell Oil due in one year has a yield of 6.5%. The default risk premiums on the bonds issued by Shell and Ford, respectively, are A. 1.0% and 1.2%. B. 0.7% and 1.5%. C. 1.2% and 1.0%. D. 0.8% and 1.3%. E. None of the options are correct. 6. A coupon bond that pays interest annually is selling at a par value of $1,000, matures in five years, and has a coupon rate of 9%. The yield to maturity on this bond is A. 8.0%. B. 8.3%. C. 9.0%. D. 10.0%. E. None of the options are correct

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