Bond Yields
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Assume the par value of the bonds in the following problem is $1,000.
Garland Corp. has a bond outstanding with a $90 annual interest payment, a market price of $820, and a maturity date in 10 years.
a. What is the coupon rate?
b. What is the current rate?
c. What is the approximate yield to maturity?
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a. What is the coupon rate
current price = 820
future price (par) = 1000
coupon rate = annual interest payment / ...
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