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?
The question belongs to Finance and it is about calculation of current yield of a government bond issues 5 years ago and which pays out an annual coupon payment and matures at the end of 4 years. A discounted cash flow has been calculated to estimate the current value of the bond.
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