If Risky Inc.has an outstanding bond with an annual coupon payment of $120 and is currently priced at $842,what is this bond's current yield?

Name: If Risky Inc.has an outstanding bond with an annual coupon payment of $120 and is currently priced at $842,what is this bond's current yield?
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Quizplus · Accepted Answer

The current yield is calculated as the annual coupon payment divided by the current price of the bond. So, $120 / $842 = 0.1425, or 14.25%.