Lydic Corporation has bonds on the market with 12.5 years to maturity, a YTM of 6.4 percent,

Question:

Lydic Corporation has bonds on the market with 12.5 years to maturity, a YTM of 6.4 percent, a par value of $1,000, and a current price of $1,040. The bonds make semiannual payments. What must the coupon rate be on these bonds?

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... Coupon
A coupon or coupon payment is the annual interest rate paid on a bond, expressed as a percentage of the face value and paid from issue date until maturity. Coupons are usually referred to in terms of the coupon rate (the sum of coupons paid in a... 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,...