15-year bond with a face value of $1,000 currently sells for $850. - 37727

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***Bond's yield correct statement with discussion***


15-year bond with a face value of $1,000 currently sells for $850. Which of the following statements is CORRECT Answer

 

·         The bond’s coupon rate exceeds its current yield.

·         The bond’s current yield exceeds its yield to maturity.

·         The bond’s yield to maturity is greater than its coupon rate.

·         The bond’s current yield is equal to its coupon rate.

·         If the yield to maturity stays constant until the bond matures, the bond’s price will remain at $850

 

 

 

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***Bond'

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