A 30-year maturity bond with face value of $1,000 makes semiannual coupon payments and has a coupon rate of 9.2%. (Do not round intermediate calculations. Enter your answers as a percent rounded to 3 decimal places.) |
a. | What is the yield to maturity if the bond is selling for $960? |
Yield to maturity | % |
b. | What is the yield to maturity if the bond is selling for $1,000? |
Yield to maturity | % |
c. | What is the yield to maturity if the bond is selling for $1,080? |
Yield to maturity | % |
Bond Par Value = $1,000
Time to maturity = 30 years
Coupon Rate = 9.2% semi-annually
a.
Bond Price = $960
Calculating YTM of Bond,
Using TVM Calculation,
I = [FV = 1000, PV = 960, T = 60, PMT = 46]
YTM = 9.52%
b.
Bond Price = $1000
Calculating YTM of Bond,
Using TVM Calculation,
I = [FV = 1000, PV = 1000, T = 60, PMT = 46]
YTM = 9.2%
c.
Bond Price = $1080
Calculating YTM of Bond,
Using TVM Calculation,
I = [FV = 1000, PV = 1080, T = 60, PMT = 46]
YTM = 8.59%
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