Question: A bond with 1000 par value, has 14 years left to maturity has a coupon rate of 10% with semi-annual coupon payments. The current yield

A bond with 1000 par value, has 14 years left to maturity has a coupon rate of 10% with semi-annual coupon payments. The current yield to maturity is 13.5%. What is the current yield?

Step by Step Solution

★★★★★

3.41 Rating (160 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

To find the current yield of a bond we need to use the formula textCurrent Yield fractextAnnual Coup... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

A typical section of a building wall is shown in Fig. P1758. This section extends in and out of the page and is repeated in the vertical direction. The wall support members are made of steel (k = 50...

At $1,000 par value, a 10-percent coupon bond matures in 20 years. If the price of the bond is $1,196.80, what is the yield to maturity on the bond? Assume interest is paid annually.

Demonstrate when the current yield exceeds (or is less than) the yield to maturity.

A 6.5 percent coupon bond with 14 years left to maturity is priced to offer a 7.2 percent yield to maturity. You believe that in one year, the yield to maturity will be 6.8 percent. What is the...

A bond with 1000 par value, has 14 years left to maturity has a coupon rate of 10% with semi-annual coupon payments. The current yield to maturity is 15.5%. What is the current yield? 13.64% 11.15%...

Even though most corporate bonds in the United States make coupon payments semiannually, bonds issued elsewhere often have annual coupon payments. Suppose a German company issues a bond with a par...

1) Even though most corporate bonds in the United States make coupon payments semiannually, bonds issued elsewhere often have annual coupon payments. Suppose a German company issues a bond with a par...

Even though most corporate bonds in the United States make coupon payments semiannually, bonds issued elsewhere often have annual coupon payments. Suppose a German company issues a bond with a par...

show all workings very urgent please QUESTION 2 a. Use the constant-growth dividend model (Gordon growth model) to find the value of each firm shown in the following table. Firm Required return (%) A...

1. Even though most corporate bonds in the United States make coupon payments semiannually, bonds issued elsewhere often have annual coupon payments. Suppose a German company issues a bond with a par...

Which of the following overloaded functions are called in each of the calls in main()? If any of the calls are ambiguous (that is, they can't be resolved), list all the candidate functions void func...

We have seen a number of theorems concerning sufficiency and related concepts for exponential families. Theorem 5.2.11 gave the distribution of a statistic whose sufficiency is characterized in...

Ebony bought $ 1 0 , 0 0 0 of stock in company XYZ at $ 5 0 per share. After some years, Ebony sells all her stock at $ 7 0 per share. How much total does she receive from selling all her stock?...

The Budgetary Comparison Schedule for the City of Vienna appears below. Several items of information are missing (denoted with ?). Required: a. Determine the missing amounts. b. During the year, the...

A car active suspension system adds an active hydraulic actuator in parallel with the passive damper and spring to create a dynamic impedance that responds to road variations. The block diagram of...

Instead of receiving a paycheck every two weeks, Allessandro runs her payroll card through a machine as she leaves work. The card is thereby electronically credited with the amount of her pay and...

Write a set of rules for family relationships, including all relationships from grandparents through two generations. Now add these to the facts of Problem 3, and eliminate as many of the facts as...

Each of the following languages is the intersection of two simpler languages. In each part, construct DFAs for the simpler languages, then combine them using the construction discussed in footnote 3...

2. It is imperative that the first responding officer(s) to a random act of violence differentiate between a ____ and _____

How would you calculate these using excel? What are the formulas? Question 1. GTF Corporation has 5 percent coupon bonds on the market with a par of S1,000 and 15 years left to maturity. The bonds...

please explain how to calculate in a financial calculator Question 2. MTV Corporation has 7 percent coupon bonds on the market with a par of $1,000 and 8 years left to maturity. The bonds make...

please answer them all quick 22) A proxy staternent gives shareholders the right A) of one wote for each ghare owned B) to give up their wote to another party C) to maintain the vote to another party...

I NEED HELP PLS Questions 9-14 are based on the following information. Bond valuation. On Jan. 1, 2016, your cousin, Laura, purchased one $1,000, 3-year semiannual bond with a coupon rate of 8%. The...

If the yield of maturity of the bond is lower than the coupon rate, the price of this bond will be? Select one: a. Higher than the par value. b. Lower than the par value. c. Equal the par value. The...

I need EXCEL Solution in the templete. Thanks A company must make yearly payments starting at $100,000 and increasing by 6% every year for 10 years. Payments are due at the end of each year. They can...