Nikita Enterprises has bonds on the market making annual payments, with eleven years to maturity, a par value of $1,000, and selling for $970. At this price, the bonds yield 7 percent. What must the coupon rate be on the bonds? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Essentials Of Investments
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Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
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Chapter1: Investments: Background And Issues
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Problem 7-5 Coupon Rates [LO2]
Nikita Enterprises has bonds on the market making annual payments, with eleven years
to maturity, a par value of $1,000, and selling for $970. At this price, the bonds yield 7
percent. What must the coupon rate be on the bonds? (Do not round intermediate
calculations and enter your answer as a percent rounded to 2 decimal places, e.g.,
32.16.)
Answer is complete but not entirely correct.
Coupon rate
1.92 X %
Transcribed Image Text:Problem 7-5 Coupon Rates [LO2] Nikita Enterprises has bonds on the market making annual payments, with eleven years to maturity, a par value of $1,000, and selling for $970. At this price, the bonds yield 7 percent. What must the coupon rate be on the bonds? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Answer is complete but not entirely correct. Coupon rate 1.92 X %
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