Question
A bond with face value P100,000 has a semiannual coupon rate of 6%. With a time to maturity of 5 years, the bond is sold
A bond with face value P100,000 has a semiannual coupon rate of 6%. With a time to maturity of 5 years, the bond is sold for P102,000. (Disregard withholding tax.)
15. What is the current yield of the buyer?
16. How much is the buyer’s return?
Step by Step Solution
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Step: 1
To calculate the current yield of the buyer we need to divide the annual coupon payment by the bonds ...
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Fundamentals Of Corporate Finance
Authors: Richard A. Brealey, Stewart C. Myers, Alan J. Marcus
11th Edition
1264101562, 978-1264101566
