Net income plus operating expenses is equal to

Suppose the U.S. Treasury offers to sell you a bond for $3,000. No payments will be made until the bond matures 10 years from now, at which time it will be redeemed for $5,000. What interest rate would you earn if you bought this bond at the offer price?

A) 5.24% B) 6.93% C) 6.70% D) 7.48% E) 7.79%

If a bond's rating declines, the interest rate demanded by investors, called the required return, also

decreases. Indicate whether the statement is true or false