The 12-year $1,000 par bonds of Vail Inc. pay 12 percent interest. The
market's required yield to maturity on a comparable-risk bond is 9 percent. The current market price for the bond is $1,070.
Determine the yield to maturity.
b. What is the value of the bonds to you given the yield to maturity on a comparabie-risk bond?
Should you purchase the bond at the current market price?