What is the current yield on the following


What is the "current yield" on the following bond?

Par value $1000

Coupon rate 8%

Years to maturity 12

Market interest rate 7%

Market price $1080

 

a. 80/1000 = 8.7%

b. 70/1080 = 6.5%

c. 70/1000 = 7.6%

d. 80/1080 = 7.4%

e. (8 * 7)/1000 = 5.6%

 

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Finance Basics: What is the current yield on the following
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