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A 4.25 percent coupon bond with eight years left to maturity is offered for sale at...

A 4.25 percent coupon bond with eight years left to maturity is offered for sale at $983.36. What yield to maturity is the bond offering? (Assume interest payments are paid semi-annually and par value is $1,000.)

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Answer #1
Yield to maturity is the yield earned by an investor when it holds investment till its maturity.
Yield to maturity = =rate(nper,pmt,-pv,fv)*2
= 4.50%
Where,
nper Number of period 8*2 = 16
pmt Coupon payment 1000*4.25%*6/12 = $         21.25
pv Current price = $      983.36
fv Face value $   1,000.00
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