Current Yield What's the current yield of a 5.75 percent coupon corporate bond quoted at a price of 103.05?
A)5.58 percent
B)5.75 percent
C)5.93 percent
D)17.54 percent

Question

Quizplus · Accepted Answer

The current yield is calculated as the annual coupon payment divided by the bond's current price. The annual coupon payment is 5.75% of the bond's face value (usually $100), which is $5.75. The bond's current price is 103.05. Therefore, the current yield is ($5.75 / $103.05) * 100 = 5.58%.

Current Yield What's the Current Yield of a 5