Skolits Corp. issued 20-year bonds 2 years ago at a coupon rate
of 7.4 percent. The bonds make semiannual payments. If these bonds
currently sell for 104 percent of par value, what is the YTM?
(Do not round intermediate calculations. Enter your answer
as a percent rounded to 2 decimal places, e.g.,
Number of year remains in maturity = 20 year - 2 year
= 18 year.
Par Value of bond = $1,000
Current price = $1,000 × 104%
Curent price of bond is $1,040.
YTM of bond is calculated in excel and screen shot provided below:
Yield to maturity of bond is 7.01%.
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