A 9.9 percent coupon (paid semiannually) bond, with a $1,000 face value and 24 y

Question

A 9.9 percent coupon (paid semiannually) bond, with a $1,000 face value and 24 years remaining to maturity. The bond is selling at $940. (Do not round intermediate calculations. Round your answer to 3 decimal places. (e.g., 32.161))

An 10.4 percent coupon (paid quarterly) bond, with a $1,000 face value and 10 years remaining to maturity. The bond is selling at $906. (Do not round intermediate calculations. Round your answer to 3 decimal places. (e.g., 32.161))

An 9.4 percent coupon (paid annually) bond, with a $1,000 face value and 10 years remaining to maturity. The bond is selling at $1,056. (Do not round intermediate calculations. Round your answer to 3 decimal places. (e.g., 32.161))

Explanation / Answer

YTM= Interest+FV- BV/2/FV+BV/2

Interest=1000*9.9%/2=49.5

YTM=49.5+1000-940/24*2/1000+940/2

YTM=50.75/970

YTM=5.23*2 = 10.46%

2. Interest=1000*10.4%/4 = 26

YTM=26+1000-906/10/4/1000+906/2

= 28.35/953*100*4

YTM= 11.90%

C. Interest =1000*9.4% =94

YTM = 94+1000-1056/10/1000+1056/2

YTM= 88.4/1028*100

Yield To Maturity = 8.60%

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