Annual Interest Payment on a Bond
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A 5 year treasury bond with a coupon rate of 8% has a face value of $1000 and a yield to maturity of 7%. What is the bonds annual interest payment?
a) $10
b) $40
c) $80
d) $100
e) $140
f) The annual interest payment cannot be determined because the current market price of the bond is not provided.
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Solution Summary
The solution computes the annual interest payment on a bond.
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