Sweet Suë Foods has bonds outstanding with a coupon rate of 5.44 percent paid semiannually and sell for \( \$ 1,930.36 \). The bonds have a par value of \( \$ 2,000 \) and 17 years to maturity. What is the current yield for these bonds? a. \( 2.82 \% \) b. \( 5.44 \% \) c. \( 6.11 \% \) d. \( 5.35 \% \) e. \( 5.64 \% \)

To calculate the current yield, you can use the formula: \[ \text{Current Yield} = \frac{\text{Annual Coupon Payment}}{\text{Current Price}} \] The annual coupon payment for Sweet Suë Foods' bonds can be calculated by taking the coupon rate and multiplying it by the par value. Given a coupon rate of 5.44% and a par value of $2,000, the annual payment is: \[ \text{Annual Coupon Payment} = 0.0544 \times 2000 = \$108.80 \] Now, substituting these values into the current yield formula: \[ \text{Current Yield} = \frac{108.80}{1930.36} \approx 0.0563 \text{ or } 5.63\% \] So the closest answer is: e. \( 5.64 \% \) Sweet Suë Foods' bonds have a current yield of about 5.64%. Keep in mind that when you’re considering bond investments, it's also good to look beyond the current yield to understand the total return you might expect, including any capital gains or losses as the bond approaches its maturity date!