Which $1,000 bond has the higher yield to maturity, a 20-year bond selling for $800 with a current yield of 10% or a one-year bond selling for $800 with a current yield of 5%? The yield to maturity for a one-year bond is %. (Round to one decimal place.) The yield to maturity for a 20-year bond is approximately%. (Round to the nearest whole number.) The yield to maturity on the one-year bond is the yield to maturity for a 20-year bond discussed.

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Which $1,000 bond has the higher yield to maturity, a 20-year bond selling for $800 with a current yield of 10% or a one-year bond selling for $800
with a current yield of 5%?
The yield to maturity for a one-year bond is%. (Round to one decimal place.)
The yield to maturity for a 20-year bond is approximately%. (Round to the nearest whole number.)
The yield to maturity on the one-year bond is
the yield to maturity for a 20-year bond discussed.
Transcribed Image Text:Which $1,000 bond has the higher yield to maturity, a 20-year bond selling for $800 with a current yield of 10% or a one-year bond selling for $800 with a current yield of 5%? The yield to maturity for a one-year bond is%. (Round to one decimal place.) The yield to maturity for a 20-year bond is approximately%. (Round to the nearest whole number.) The yield to maturity on the one-year bond is the yield to maturity for a 20-year bond discussed.
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