Question: On issue date, Eric bought a bond offered with the following details. For simplicity, assume that coupons are tax-free. Issuer 16888 Corporation Par Value P10,000

On issue date, Eric bought a bond offered with the following details. For simplicity, assume that coupons are tax-free.

Issuer

16888 Corporation

Par Value

P10,000

Tenor

5 years

Coupon Rate

5.2% p.a.

Coupon Payment

every 3 months

Issue Date

December 10, 2018

Maturity Date

December 10, 2023

If Eric sells the bond on December 10, 2020 at P10,100, what would be the current yield of the buyer?

A.) 5.2%

B.) 5.25%

C.) 5.15%

D.) 5.3%

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