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Posted on Jul 21, 2024

The current yield on a $10,000, 10 percent coupon bond selling for $8,000 is (a) 10.0 percent. (b) 12.5 percent. (c) 15.0 percent. (d) 17.5

The current yield on a $10,000, 10 percent coupon bond selling for $8,000 is (a) 10.0 percent. (b) 12.5 percent. (c) 15.0 percent. (d) 17.5 percent.

The answer is b but Im not sure how to calculate it. Please show the steps to the answer. Thank you!

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