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Homework answers / question archive / a bond that pays interest semiannually bas a coupon rate of 5

a bond that pays interest semiannually bas a coupon rate of 5

Finance

a bond that pays interest semiannually bas a coupon rate of 5.41 percent and a curremt yield of 4.89 percent. The par value is $1000. What is the bond's price?

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Current yield = annual coupon / current price

Current price = annual coupon / current yield

= 54.1 / 0.0489

= $1,106.34

Bond's price is $1,106.34

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