What yield to maturity can she expect to earn

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Question 1 - Sarah Allen is looking to invest in a three-year bond that makes semi-annual coupon payments at a rate of 5.275 percent. If these bonds have a market price of $982.49, what yield to maturity can she expect to earn?

Question 2 - Kenneth Clark bought 10-year, 10.3 percent coupon bonds issued by the U.S. Treasury three years ago at $900.69. If he sells these bonds, for which he paid the face value of $1,000, at the current price of $828.68, what is his realized yield on the bonds? Assume similar coupon-paying bonds make annual coupon payments.

Reference no: EM132986152

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