The Lo Sun Corporation offers a 6% bond with a current market price of $875.05.The yield to maturity is 7.34%.The face value is $1,000.Interest is paid semiannually.How many years is it until this bond matures?

Question

Quizplus · Accepted Answer

The correct answer is A because the bond has a maturity of 16 years. This can be calculated using the following formula:Maturity = (Face Value / Current Market Price) * (1 + Yield to Maturity / 2)^(-2 * Number of Years)Plugging in the given values, we get:16 = (1000 / 875.05) * (1 + 0.0734 / 2)^(-2 * Number of Years)Solving for Number of Years, we get:Number of Years = 16

The Lo Sun Corporation Offers a 6% Bond with a Current