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Mary wants to invest her recent bonus in an eight-year bond that pays a coupon of...

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Finance

Mary wants to invest her recent bonus in an eight-year bond thatpays a coupon of 9 percent annually. The bonds areselling at $1,125.46 today. If she buys this bond and holds it tomaturity, what would be her yield?

Answer & Explanation Solved by verified expert
3.8 Ratings (729 Votes)
Basically if the price is give as 112546 at time 0 it isassumed that the par value is 1000 and the yield will be lower thanthe coupon rate The bond    See Answer
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Mary wants to invest her recent bonus in an eight-year bond thatpays a coupon of 9 percent annually. The bonds areselling at $1,125.46 today. If she buys this bond and holds it tomaturity, what would be her yield?

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