Problem: Which of the following statements is true?
1) A bond that has a rating of AA is considered to be a junk bond.
2) A bond will sell at a premium if the prevailing required rate of return is less than the bond's coupon rate.
3) A zero coupon is a bond that is secured by a lien on real property.
4) The legal document that describes all of the terms and conditions of a bond issue is called a debenture agreement.