Answer:
6.30 percent
Explanation:
Base on the scenario been described in the question. For we to calculate the current yield of one of the bond, we have to use the following procedure
Current yield = ( 0.065×$1,000)/(1.0316 × $ 1,000)
Current yield = 65 / 1,031.6
Current yield = 0.063008918185343× 100%
Current yield = 6.30percent approximately.
Answer:
5.04%
Explanation:
Current yield is the ratio of coupon payment of a bond to its current market price. It is calculated by using coupon payment and the current market value of the bond.
Coupon Payment = $1,000 x 5.2% = $52
Formula for Current yield is as follow
Current Yield = Annual Coupon Payment / Current Market Price
Current Yield = $52 / $1,031.60
Current Yield = 5.04%
