# Current Yield, Yield to Maturity & Effective Annual Yield

The 7 percent coupon bonds of Firm X are selling for 102 percent of par value. The bonds mature in 6 years and pay interest semiannually.

What is the current yield, yield to maturity and effective annual yield?

1. 6.86; 6.59; 6.70

2. 6.86; 6.23; 6.53

3. 6.37; 6.23; 6.53

4. 6.37; 6.59; 6.86

5. 6.59; 6.65; 6.70

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Current Yield, Yield to Maturity & Effective Annual Yield

The 7 percent coupon bonds of Firm X are selling for 102 percent of par value. The bonds mature in 6 years and pay interest semiannually.

What are the current yield, yield to maturity and effective annual yield?

1. 6.86; 6.59; 6.70

2. 6.86; 6.23; 6.53

3. 6.37; 6.23; 6.53

4. 6.37; 6.59; 6.86

5. 6.59; 6.65; 6.70

Answer: 1

Current yield = Annual Coupon Payment/Current Price

= 70/1,020

= ...

#### Solution Summary

This solution is comprised of a detailed explanation to calculate what is the current yield, yield to maturity and effective annual yield.