Which of the following best describes the term yield to maturity for an n period bond paying a coupon at rate r semi-annually?

Select one:

a. The EAR results when 1 plus the coupon rate is compounded to reflect that payments are made semi-annually, minus 1.

b. The coupon rate r.

c. The annualized ratio of the final principal payment divided by current price of the bond.

d. The interest rate that equates a bond's present value of future payments to its price.

e. None of the above.

What is the value of a $1,000 face value bond with a 6% annual pay coupon of 6% and 10 years left to maturity if the relevant discount rate is 6% per year?

Select one:

a. $836.22

b. $1,000.00

c. $927.50

d. $1,128.63