If a 6.75% coupon bond is trading for $1,016.00, it has a current yield of

Name: If a 6.75% coupon bond is trading for $1,016.00, it has a current yield of
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The current yield of a bond is calculated by dividing the annual coupon payment by the market price of the bond. For a 6.75% coupon bond, the annual coupon payment is 6.75% of the face value, which is typically $1,000, so the annual coupon payment is $67.50. The current yield is then $67.50 / $1,016.00 = 0.0664 or 6.64%.

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