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Computing Current Yield and Yield to Maturity

A bond has 16 years until maturity, a coupon rate of 5.8%, and sells for $1,109.

a. What is the current yield on the bond? (Round your answer to 2 decimal places.)

Current yield %

b. What is the yield to maturity? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Yield to maturity %

Solution Summary

This solution illustrates how to compute a bond's current yield and yield to maturity.

$2.19