You own a bond with a par value of $1,000 and a coupon rate of 8.50% (semiannual coupon). You know it has a current yield of 7.0
0%. What is its yield to maturity? The bond has 6 years to maturity. Current Yield = (annual payment / price). (hint: solve for price to answer the question). Group of answer choices
1 answer:
Answer:
Answer for the question:
You own a bond with a par value of $1,000 and a coupon rate of 8.50% (semiannual coupon). You know it has a current yield of 7.00%. What is its yield to maturity? The bond has 6 years to maturity. Current Yield = (annual payment / price). (hint: solve for price to answer the question). Group of answer choices
is given in the attachment.
Explanation:
You might be interested in
Answer:
C) 9.00; 8.92
Explanation:
The arithmetic rate of return is given by:
The geometric rate of return is given by:
Therefore, the arithmetic rate of return is 9.00 percent and the geometric rate of return is 8.92 percent
The answer is C) 9.00; 8.92.