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Fundamentals Corporate Finance
Turn back to Table 6.1. a. What is the current

Turn back to Table 6.1. a. What is the current yield of the 4.75% 2041 maturity bond?

Question:

Turn back to Table 6.1.

a. What is the current yield of the 4.75% 2041 maturity bond? What is its yield to maturity?

b. ?The current yield is less than the yield to maturity whenever the bond price is greater than the face value.? True or false?

Transcribed Image Text:

Change Asked yleld to maturity (%) 2.228 In Coupon 1.375 2.25 7.625 5.25 Asked -0.0078 0.0313 0.1094 0.2344 Maturity 15-Feb-2020 Bld Asked 98.3438 98.3281 99.5938 130.6875 121.9141 15-Feb-2021 15-Feb-2025 15-Feb-2029 15-Feb-2036 99.5781 2.391 130.6719 121.8516 120.9063 2.770 2.908 120.9688 4.5 2.986 0.5313 15-Feb-2041 4.75 127.2422 127.3047 3.084 0.6641 3 15-Feb-2048 97.2656 0.7266 3.140 97.2969

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The bond pays a coupon of 475 which means annual interest is 4750 The bond ...View the full answer

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Related Book For answer-question

Fundamentals of Corporate Finance

ISBN: 978-1260566093

10th edition

Authors: Richard Brealey, Stewart Myers, Alan Marcus

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Question Posted: Oct 25, 2019 07:18 AM

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