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A Government Bond Issued in Germany Has a Coupon Rate

Question 2

Multiple Choice

A government bond issued in Germany has a coupon rate of 5 percent, a face value of 100 euros, and matures in five years.The bond pays annual interest payments.Calculate the yield to maturity of the bond (in euros) if the price of the bond is 106 euros.


A) 5.00 percent
B) 3.80 percent
C) 3.66 percent
D) 6.00 percent

Correct Answer:

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