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Determining the current yield on the bond

Question 1: Bond Pricing. A 6-year Circular File bond pays interest of $80 annually and sells for $950. What is its coupon rate, current yield, and yield to maturity?

Question 2: Bond Pricing. If Circular File (see question 4) wants to issue a new 6-year bond at face value, what coupon rate must the bond offer?

Question 3: Bond Yields. An AT&T bond has 10 years until maturity, a coupon rate of 8 percent, and sells for $1,100.

a. What is the current yield on the bond?

b. What is the yield to maturity?

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Finance Basics: Determining the current yield on the bond

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Finance Basics: Determining the current yield on the bond

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