If a 30-year, $1,000 bond has a 9% coupon and is currently selling for $826, its current yield is:

Name: If a 30-year, $1,000 bond has a 9% coupon and is currently selling for $826, its current yield is:
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Quizplus · Accepted Answer

The current yield is calculated by dividing the annual interest payment (coupon payment) by the current market price of the bond and multiplying by 100%.

Annual interest payment = 9% x $1,000 = $90 
Current yield = ($90 / $826) x 100% = 10.9%

If a 30-Year, $1,000 Bond Has a 9% Coupon and Is