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Skolits Corp. issued 20-year bonds 2 years ago at a coupon rate of 7.4 percent. The...

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., 32.16.)

YTM              %​

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Answer #1

Number of year remains in maturity = 20 year - 2 year

= 18 year.

Par Value of bond = $1,000

Current price = $1,000 × 104%

= $1,040

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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