Alaskan Motors has outstanding bonds that mature in 13 years and pay $34.50 every 6 months in interest.The par value is $1,000 per bond and the market value is $990.The coupon rate is ________ percent,the current yield is ________ percent,and the yield to maturity is ________ percent.

Question

Quizplus · Accepted Answer

Coupon rate = ($34.50 × 2)/$1,000 = 6.90 percent
Current yield = ($34.50 × 2)/$990 = 6.97 percent
Yield to maturity = 7.02 percent
Using a financial calculator:
 11ea6d0e_c3ec_ff6d_b3c7_89c63867d718_TB1223_00

Alaskan Motors Has Outstanding Bonds That Mature in 13 Years