imimperious128 imimperious128
  • 10-11-2020
  • Business
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What is the current yield of a bond with a 6% coupon, 4 years until maturity, and a price quote of 84

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abiolataiwo2015
abiolataiwo2015 abiolataiwo2015
  • 11-11-2020

Answer:

7.14%

Explanation:

Calculation for the current yield of a bond

Current yield = (6%×$1,000) / (0.84 × $1,000)

Current yield = $60 / (0.84 × $1,000)

Current yield = $60 / $840

Current yield = 0.0714*100

Current yield =7.14%

Therefore the Current yield will be 7.14%

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