What condition must exist if a bond’s coupon rate is to equal both the bond’s current yield and its yield to maturity? Assume the market rate of interest for this bond is positive.

The condition that must exist if a bond’s coupon rate is to equal both the bond’s current yield and its yield to maturity is that THE BOND MUST BE PRICED AT PAR.

Explanation:

The par value is also the amount upon which the entity calculates the interest that it owes to investors. Thus, if the stated interest rate on a bond is 10% and the bond par value is $1,000, then the issuing entity must pay $100 every year until it redeems the bond.Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments.When a bond is issued at par value it is sold for the face value amount. This generally means that the bond's market and contract rates are equal to each other, meaning that there is no bond premium or discount.

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