The face value of a bond is $1,000 and its coupon rate is 3.80% with coupons paid semiannually. Its term to maturity is 14 years. If the yield to maturity of the bond is 6.30%, what is the current yield of the bond today? a. 4.94% b. 1.90% c. 3.80% x Od. 6.30% e. 2.47%

The face value of a bond is $1,000 and its coupon rate is 3.80% with coupons paid semiannually. Its term to maturity is 14 years. If the yield to maturity of the bond is 6.30%, what is the current yield of the bond today? a. 4.94% b. 1.90% c. 3.80% x Od. 6.30% e. 2.47%

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 12P: Bond Yields and Rates of Return A 10-year, 12% semiannual coupon bond with a par value of 1,000 may...

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Question

The face value of a bond is $1,000 and its coupon rate is
3.80% with coupons paid semiannually. Its term to maturity
is 14 years. If the yield to maturity of the bond is 6.30%,
what is the current yield of the bond today?
a. 4.94%
b. 1.90%
c. 3.80% x
d. 6.30%
e. 2.47%

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