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### Foundations Of Financial Management

Book edition 16th
Author(s) Stanley B. Block, Geoffrey A. Hirt, Bartley Danielsen
Pages 768 pages
ISBN 9781259277160

# The Pioneer Petroleum Corporation has a bond outstanding with an $85 annual interest payment, a market price of$800, and a maturity date in five years. Find the following: a. The coupon rate. b. The current rate. c. The yield to maturity

b. The current rate is 10.625%.

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## Current rate

The current rate explains the relationship between the interest payment and the bond's market price. It is computed when the bond's par value and current value are different.