A bond has a $1,000 face value and a $989 market value. The bond pays interest semi-annually, has a yield-to-maturity of 7.47 percent, and matures in 12 years. What is the current yield?
a. 6.67 percent
b. 7.41 percent
c. 7.47 percent
d. 8.01 percent
The solution explains the calculation of current yield on a bond