A bond has a coupon rate of 6 percent and the bond makes semiannual coupon payments. The dollar amount of coupon interest received every six months is

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The coupon rate is 6%, which means that the bond pays 6% of the face value in coupon interest per year. Since the bond pays semiannually, the dollar amount of coupon interest received every six months is half of the annual coupon interest. Thus, the amount of coupon interest received every six months is 6% divided by 2, or 3%. If the face value of the bond is $1,000, then the dollar amount of coupon interest received every six months is $30 ($1,000 multiplied by 3%).

A Bond Has a Coupon Rate of 6 Percent and the Bond