单选题 John has a 10-year bond outstanding with an annual coupon of 6.5 percent. If the bond is currently priced at $1089.25, which of the following is closest to the bond-equivalent yield of the bond?

A、

A. 5.33%.
B、

B. 5.42%.
C、

C. 5.26%.

【正确答案】 C

【答案解析】
First, find the annual yield to maturity of the bond as: FV=$1000, PMT=$ 65, N=10, PV=-1089.25, and solve for I/Y=5.33%. Then, find the BEY as: 2×[(1+YTM)^0.5-1]=0.0526=5.26%.