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Question 6.21 Yield to maturity – The Egoli company bond currency sells for R955, has a...

Question 6.21

Yield to maturity – The Egoli company bond currency sells for R955, has a 12% coupon interest rate

And a R1000 par value pays interest annually and has 15 years to maturity

a.Calculate the yield to maturity (YTM) on this bond

b.Explain the relationship that exists between the coupon interest rate and yield to maturity and between the par value and market value of a bond

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