A single bond with a face value of $1,000 has a stated annual interest rate of 7.6%. The last bond traded on this day was 98.45%. Determine the bond yield.

Respuesta :

The bond yield is 7.7%.

Face value is what?

The nominal or dollar value of a security, as indicated by its issuer, is referred to as face value in the financial context. The face value of stocks is the price at which they were purchased. It is the sum, usually in $1,000 increments, that is paid to the bondholder upon maturity. Bond face values are frequently referred to as "par value" or just "par." When investing in bonds, face value (also known as par value) refers to the sum that, provided the bond issuer doesn't default, is paid to a bondholder when the bond matures. But secondary market bonds are subject to interest rate fluctuations.

According to the question:

Bond Strength = Yearly interest / Cost of the bond at closing X 100

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