On September 1, 2002, Biff receives a coupon payment of $750. The market interest rate on bonds like his remains 6 percent. Biff sells his bond to Cass at that time, for a price equal to the present value of the bond's payments. c. How much does Cass pay Biff for the bond? d. Calculate Biff's current yield, capital-gains yield, and total return for the year.

Answer rating: 100% (QA)

To calculate the present value of the bonds payments and then determine how much Cass pays Biff for ... View the full answer