USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

Multiple Choice

USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)
Consider two bonds, both pay semiannual interest. Bond A has a coupon of 8 percent per year, maturity of 30 years, yield to maturity of 9 percent per year, and a face value of $1000. Bond B has a coupon of 8 percent per year, maturity of 30 years, yield to maturity of 9.5 percent per year, and a face value of $1000.
-Refer to Exhibit 13.10. Calculate the value of swap out of Bond A into Bond B.

A) 0.41 percent
B) 1.73 percent
C) 0.23 percent
D) 0.00 percent
E) 0.51 percent