What yield will you obtain

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Reference no: EM131066406

You buy a 10-year, $1000 bond with a coupon rate of 6%, payable annually

a) if you pay the face value of $1000 and you hold the bond to maturity, what yield will you obtain?

b) at what price would you purchase the bond if you wanted a yield of 8% for the 10 years?

c) if you buy the bond for %1000 and sell it two years later (just after receiving your second coupon) to an investor for %1050, what yield have you obtained?

Reference no: EM131066406

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