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Calculation of current yield of government

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Reference no: EM13828124

Problem:

a) What is the current yield on government bond, issued exactly five years ago, that has a current market price of $5866 and pays an annual coupon payment of $350, and matures at the end of 4 years, when the face value of $5000 will be paid?

b) What is the yield to maturity of this bond?

Additional Information:

This question is from Finance as well as it is about calculation of current yield of government bond issues five years ago and which pays out an annual coupon payment as well as matures at the end of 4 years. A discounted cash flow has been computed to estimate the current value of bond.

Reference no: EM13828124

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