If the Annual Interest Rate Printed on the Face of a Bond

question 136

Multiple Choice

If the annual interest rate printed on the face of a bond is 12 percent,the face value of the bond is $1,000,and the current market price of the bond is $1,200,what is the current yield on the bond?

• A)10.0 percent.
• B)12.0 percent.
• C)8.5 percent.
• D)5.0 percent.

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Definitions:

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