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    Bonds

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    My company has a bond outstanding with a par value of $1000, an annual interest payment of $110, a market price of $1200 and a maturity in 10 years. Determine the following:

    a. Coupon rate
    b. Current yield
    c. Approximate yield to maturity

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    https://brainmass.com/business/bond-valuation/103827

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    a. Coupon rate

    Coupon rate = Annual interest payment/Par value
    = 110/1,000
    = 11.00%

    b. Current yield

    Current yield = Annual interest payment/Market price
    = 110/1,200
    = 9.17%

    c. Approximate yield to maturity

    We need to ...

    Solution Summary

    This solution is comprised of a detailed explanation to determine the coupon rate, current yield, and approximate yield to maturity.

    $2.19

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