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Which of the following bonds offers the highest current yield?

a. A 10.14 %, 20-year bond quoted at 106.763.

b. A 16.90%, 15-year bond quoted at 177.939.

c. A 5.07%, 18-year bond quoted at 53.382.

The current yield of the bond in part A is %. (Round to two decimal places.)

The current yield of the bond in part B is %. (Round to two decimal places.)

The current yield of the bond in part C is %. (Round to two decimal places.) Which of the three bonds offers the highest current yield (Select the best answer below.)

A. The bond in part b has the highest current yield because it has the highest coupon rate and the highest market value.

B. All of the above bonds have a current yield of approximately 9.50%.

C. The bond in part a has the highest current yield because it is held for the longest period of time

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92402124

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