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A bond will pay $80 in interest at the end of each of the next three years, plus $1,000 at the end of the third year. If it has a present market price of $950, its yield-to-maturity is


A) 8.5%.
B) 9.4%.
C) 10%.
D) 10.5%.

E) B) and D)
F) A) and C)

Correct Answer

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A bond which pays a 12% coupon annually with a par of $1,000 matures in five years with a yield to maturity of 10%. If the bond currently sells for $1,085, what is its net present value?


A) $5.82
B) $17.20
C) $9.18
D) $14.18

E) B) and D)
F) None of the above

Correct Answer

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