A $100 bond with annual coupons is redeemable at par at the end of 16 years. At a purchase price of $92 the yield rate is exactly 1% more than the coupon rate. Find the yield rate on the bond. A. 11.23 % B. 2.41 % C. 5.5 % D. 9.63 % E. 11.55 %
A $100 bond with annual coupons is redeemable at par at the end of 16 years. At a purchase price of $92 the yield rate is exactly 1% more than the coupon rate. Find the yield rate on the bond. A. 11.23 % B. 2.41 % C. 5.5 % D. 9.63 % E. 11.55 %
Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter4: Bond Valuation
Section: Chapter Questions
Problem 14P: Current Yield with Semiannual Payments
A bond that matures in 7 years sells for $1,020. The bond has...
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A $100 bond with annual coupons is redeemable at par at the end of 16 years. At a purchase price of $92 the yield rate is exactly 1% more than the coupon rate. Find the yield rate on the bond. A. 11.23 % B. 2.41 % C. 5.5 % D. 9.63 % E. 11.55 %
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