Coupon Payment and Current Price of Bond.
1. Illustrate what is the yield to maturity on a one yr discount bond with a face value of $1,000 and whose current price is $950?
2. If an $8,000 coupon bond has a coupon rate of 9 percent, then the coupon payment every year is: (Hint: assume this is perpetuity and the payment will be paid every year forever.)