A $1,000 face value Treasury bond matures in 16 years,pays interest semiannually,and has a market quote of 101.0210.The coupon rate is 3.5 percent,the current yield is ___ percent,and the yield to maturity is ____ percent.

Question

Quizplus · Accepted Answer

Current yield = (3.5% × $1,000)/(101.0210% × $1,000)= .0346,or 3.46%Or:Current yield = 3.5%/101.0210% = .0346,or 3.46% Yield to maturity = 1.71% × 2 = 3.42%

A $1,000 Face Value Treasury Bond Matures in 16 Years,pays