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CFA Level 1
Fixed Income

Understanding Current Yield in Fixed Income

Very Easy Fixed Income Valuation Yield Measures

In fixed income securities, yield measures are crucial for assessing the return on an investment. One of the most basic yield measures is the current yield. The current yield is defined as the bond's annual coupon payment divided by its current market price. This concept helps investors understand how much return they can expect based on the bond's price in the market.

Please answer the following question based on this premise.

Hint

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