A coupon bond has a face value of 20000 and a coupon rate, Ask an Expert

Finance

A coupon bond has a face value of $20,000 and a coupon rate of 6%. The current price of the bond is $19,342. The expected price at the end of the year is $20,990. (When entering number answers, round to 2 decimal places and do not use commas or $ or %).

1. What is the value of the coupon payment?

2. Calculate the Current Yield on this bond using today’s price.

3. At today’s price, is the yield to maturity on this bond greater than or less than the coupon rate?

4. Calculate the expected rate of return on this bond for the year.

Please show work.

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92791042

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