Question

ABC HAS A BOND WITH A 10-YEAR MATURITY, SEMI ANNUAL COUPON OF 8% HAS A PRICE OF 933.00 WHAT IS YTM ON THIS BOND? **PLEASE USE EXCEL**

Answer #1

K = Nx2 |

Bond Price =∑ [(Semi Annual Coupon)/(1 + YTM/2)^k] + Par value/(1 + YTM/2)^Nx2 |

k=1 |

K =10x2 |

933 =∑ [(8*1000/200)/(1 + YTM/200)^k] + 1000/(1 + YTM/200)^10x2 |

k=1 |

YTM% = 9.03 |

=RATE(10*2,8*1000/(2*100),-933,1000,,)*2

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