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    Current & Effective Yield of a Bond

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    What is the current and effective annual yield for the following?

    A bond with a yield to maturity of 7.12 percent, a 6.5 percent coupon rate, a face value of $1,000, a market price of $961.85, and semiannual interest payments.

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    Current Yield = Annual Interest/ Current Price
    Annual ...

    Solution Summary

    Brief calculations show the yield for a described bond.