A 7 percent coupon bond has a face value of $1,000 and pays interest annually. The...

A 7 percent coupon bond has a face value of $1,000 and pays interest annually. The current yield is 7.3 percent. What is the current price of this bond?

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Expert Solution

Annual coupon=1000*7%=70

Current yield=Annual coupon/Current price

Current price=70/0.073

which is equal to

=$958.90(Approx)

jeff jeffy answered 2 years ago

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