1. A bond with a coupon rate of 6.5%, maturing in 10 years at a value of $1,000 and current market price of $695 will have a current yield of
A. 11.3%
B. 10.2%
C. 9.4%
D. 8.5%
2. A convertible bond is currently selling for $1,125. It is convertible into 20 shares of common which presently sell for $40 per share. The conversion premium is
A. $325
B. $215
C. 66.74 shares
D. 23.8 shares