The 7.2 percent bond of Blackford, Inc. has a yield to maturity of 7.3 percent. The bond matures in seven years, has a face value of $1,000, and pays semiannual interest payments. What is the amount of each coupon payment?
$30.00
$36.00
$72.00
$34.10
A bond's annual interest divided by its face value is referred to as the:
coupon rate
market rate.
current yield.
yield-to-maturity.
call rate.
Coupon payment = Face value * coupon rate / number of payments in a year
Coupon payment = 1,000 * 0.072/2
Coupon payment = $36
Annual interest/Face value = Coupon rate
The 7.2 percent bond of Blackford, Inc. has a yield to maturity of 7.3 percent