In August 2015, Intermarket Corporation's 6 percent coupon bonds, with a face value of $1,000, was sold for $1,050.This means that the yield on these bonds was

Question

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The yield on a bond is inversely related to its price. Since the bond was sold for more than its face value ($1,050 vs. $1,000), the yield must be less than the coupon rate of 6 percent.

In August 2015, Intermarket Corporation's 6 Percent Coupon Bonds, with a Face