Question: AT and T Corporation has several issues of bonds outstanding. One of the outstanding bonds has a five percent coupon and matures in 2004. The bonds mature on April 1st in the maturity year. Assume an investor bought this bond on April 1, 1999, and assume interest is paid yearly on April 1. Compute the yield to maturity assuming the investor buys the bond at the given price, as quoted in the financial press:
100
90
105