A bond currently priced at $1,250 with a 10% nominal yield of $100 would have a current ield of ___. The same bond priced at $800 would have a current yield of .

The correct answer is C. 8%, 12.5%. See the full explanation below for the reasoning.

Question

A bond currently priced at $1,250 with a 10% nominal yield of $100 would have a current ield of _____________. The same bond priced at $800 would have a current yield of __________.

Options

A9%, 12.5%
B12.5%, 9%
C8%, 12.5%
D12.5%, 8%

How the community answered

(36 responses)

A
6% (2)
B
11% (4)
C
81% (29)
D
3% (1)

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