Question

If the face value of a bond is $10,000 and the annual coupon payment is $600 then what is the coupon rate

Answer 1

To calculate the coupon rate, you can divide the annual coupon payment by the face value of the bond and then multiply by 100 to express it as a percentage. In this case, the coupon rate would be ($600 / $10,000) * 100 = 6%. So, the coupon rate for the bond is 6%.