Bond’s Yield to Maturity Assignment | Homework For You

Analyze the 20-year, 8% coupon rate (annual payment), $1,000 par value bond. The bond currently sells for $1,318. What’s the bond’s yield to maturity? o o 5.36% 5.68% o 6.75% o 7.85%
A 10-year corporate bond has an annual coupon payment of 8%. The bond is currently selling at par ($1.000). Which of the following statement is NOT correct?
The bond’s yield to maturity is 8%.
The bond’s current yield is 8%.
If the bond’s yield to maturity remains constant, the bond’s price will remain at par.
The bond’s capital gain yield is 8%.
Which of the following statements about sinking fund is NOT true?
Sinking fund provision facilitates the orderly retirement of the bond issue.
A company would prefer to use sinking fund to call bond if interest rate is below the coupon rate.
A company would use sinking fund to call bond if interest rate is well above coupon rate. It is a good strategy for a firm to use its sinking fund to call bond if bond sells at a big premium.. Get Finance homework help today