Today a bond has a coupon rate of 96 percent par value of


1. Today, a bond has a coupon rate of 9.6 percent, par value of $1000, 13 years until maturity, YTM of 8.6 percent, and semiannual coupons with the next one due in six months. One year ago, the price of the bond was $1,068. What is the current yield of the bond today?

2. Six years ago, Allen Corporation issued bonds that pay annual coupons, have a face value of $1,000, have an annual coupon rate of 8.4 percent, and are scheduled to mature in four years. One year ago, you bought one of those bonds for $968. The bond just paid a coupon. If the percentage return on your bond was 5.6 percent over the past year, what is the price of the bond today?

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Financial Management: Today a bond has a coupon rate of 96 percent par value of
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