Consider a zero-coupon bond with a $5,000 face value and 20 years left until maturity. If the bond is currently trading for $2,385, then the yield to maturity on this bond is closest to: A. 3.77% B. 1.89% C. 47.7% D. 52.3%

Consider a zero-coupon bond with a $5,000 face value and 20 years left until maturity. If the bond is currently trading for $2,385, then the yield to maturity on this bond is closest to: A. 3.77% B. 1.89% C. 47.7% D. 52.3%

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 8MC: Suppose a 10-year, 10% semiannual coupon bond with a par value of 1,000 is currently selling for...

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Question

Give true answer the financial accounting question

Consider a zero-coupon bond with a $5,000 face value and
20 years left until maturity. If the bond is currently trading
for $2,385, then the yield to maturity on this bond is
closest to:
A. 3.77%
B. 1.89%
C. 47.7%
D. 52.3%

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