1. What is the definition of bond premium? Are bonds typically issued at a premium?
2. Assume that an individual owns a bond that they purchased for $100,000. The bond has a 10% coupon. The bond will mature in three years and is currently selling for $125,000. What tax planning technique can the investor utilize?
3. The expected return on the stock market is 12.40% and the risk-free rate is 3.50%. Then the stock market risk premium is