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Question 15 2 pts A bond with 16 years to maturity and a semiannual coupon rate of 5.02 percent has a current yield of 5.35 p
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Answer #1

Current Yield = Coupon payment / Current bond price

Current bond price = Coupon payment / Current Yield

Current Yield = 5.35% or 0.0535

Coupon payment = $2,000 * 0.0502 * 6/12 = $100.40 / 2 = $50.2

Current bond price = [$50.20 / (0.0535 / 2)]

Current bond price = $1,876.64

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