Question
An unconventional bond makes no coupon payments for 2 years. After that, the coupon payment will be $400 per year with payments made annually. The
An unconventional bond makes no coupon payments for 2 years. After that, the coupon payment will be $400 per year with payments made annually. The bond's face value is $10,000, YTM is 5%, and it matures in 10 years. What is bond value today? $8,484.06 What is the current yield this year? 0% What is capital gains yield this year? 5% What is bond value in 2 years? $9,353.68 What is the current yield in 2 years? 4.28% What is capital gains yield in 2 years? 0% What is true about this bond after five years from today? The bond will have a current yield that is increasing.
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