Consider a 1000 par value bond with an 8 annual coupon that


1. Consider a $1,000 par value bond with an 8% annual coupon that is currently selling for $1,050. The bond pays interest annually. There are 20 years remaining until maturity.

a) What is the size of the annual coupon payments?

b) What is the current yield on the bond?

c) What is its Yield to Maturity?

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Finance Basics: Consider a 1000 par value bond with an 8 annual coupon that
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