Dynamic Systems has an outstanding bond that has a $1,000 par value and a 6 percent coupon rate. Interest is paid semiannually. The bond has 13 years remaining until it matures. Today the going interest rate is 8 percent, and it is expected to remain at this level for many years in the future. Compute the current yield. Do not round intermediate calculations. Round your answer to two decimal places. % Compute the capital gains yield that the bond will generate this year. Do not round intermediate calculations. Round your answer to two decimal places. %

Dynamic Systems has an outstanding bond that has a $1,000 par value and a 6 percent coupon rate. Interest is paid semiannually. The bond has 13 years remaining until it matures. Today the going interest rate is 8 percent, and it is expected to remain at this level for many years in the future. Compute the current yield. Do not round intermediate calculations. Round your answer to two decimal places. % Compute the capital gains yield that the bond will generate this year. Do not round intermediate calculations. Round your answer to two decimal places. %

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter6: Fixed-income Securities: Characteristics And Valuation

Section: Chapter Questions

Problem 4P

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eBook Dynamic Systems has an outstanding bond that has a $1,000 par value and an 8 percent coupon rate. Interest is paid semiannually. The bond has 10 years remaining until it matures. Today the going interest rate is 10 percent, and it is expected to remain at this level for many years in the future. Compute the current yield. Do not round intermediate calculations. Round your answer to two decimal places. _____ % Compute the capital gains yield that the bond will generate this year. Do not round intermediate calculations. Round your answer to two decimal places. _____ %
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