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Heath Foods’s bonds have 10 years remaining to maturity. The bonds have a face value of...

Heath Foods’s bonds have 10 years remaining to maturity. The bonds have a face value of $1,000 and a yield to maturity of 9%. They pay interest annually and have a 10% coupon rate. What is their current yield?

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Answer #1

Solution:-

First we need to calculate Current price of Bond-

To Calculate Current Yield of Bond-

Current Yield =

Current Yield =

Current Yield = 9.37%

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