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Question
A bond has six years to maturity and has a coupon rate of 7.5 percent. Coupon payments are made annually and the bond has a face value of $1,000. The bond is currently selling in the market for $1,127. What is the yield-to-maturity on this bond?
A. 7.5 percent
B. 5 percent
C. 11.5 percent
D. 2.5 percent
E. None of the options is correct
Answer
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