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A Four-Year Bond Has an 8 Percent Coupon Rate and a Face

Question 9

Multiple Choice

A four-year bond has an 8 percent coupon rate and a face value of $1,000. If the current price of the bond is $878.31, calculate the yield to maturity of the bond (assuming annual interest payments) .


A) 8 percent
B) 10 percent
C) 12 percent
D) 6 percent

Correct Answer:

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