A 7-year, 10% annual-pay bond has a par value of $1,000. If its yield-to-maturity (YTM) is 12.4%, the amount earned from reinvestment of the coupon payment is closest to   A. $239.47. B. $321.41. C. $480.06. D. $500.79.

Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
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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 7-year, 10% annual-pay bond has a par value of $1,000. If its yield-to-maturity (YTM) is 12.4%, the amount earned from reinvestment of the coupon payment is closest to

 

A.

$239.47.

B.
$321.41.
C.

$480.06.

D.

$500.79.

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