Describe and differentiate between bonds (a) Current yield (b) Yield to maturity Why are these yield measures important to the bond investor Find the yield to maturity of a 20 year, 9 percent, and $1,000 par value bond trading at a price of $850 Whats the current yield on this bond ...

a The current yield is found by dividing the annual interest income by the market price of the bond ...

Describe and differentiate between bonds (a) Current yield (b) Yield to maturity. Why are these yield measures

Question:

Describe and differentiate between bonds
(a) Current yield
(b) Yield to are these yield measures important to the bond investor? Find the yield to of a 20-year, 9 percent, and $1,000 bond trading at a price of $850. What’s the current yield on this bond?

Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...