A coupon bond that pays interest annually is selling at par value of $1,000,matures in 5 years,and has a coupon rate of 9%.The yield to maturity on this bond is:

Question

Quizplus · Accepted Answer

The yield to maturity (YTM) of a bond selling at par is equal to its coupon rate. Since the bond is selling at its par value of $1,000 and has a coupon rate of 9%, the YTM is also 9%.

A Coupon Bond That Pays Interest Annually Is Selling at Par