What is the yield to maturity of a five-year, $5,000 bond with a 4.4% coupon rate...

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What is the yield to maturity of a five-year, $5,000 bond with a 4.4% coupon rate...

What is the yield to maturity of a five-year, $5,000 bond with a 4.4% coupon rate and semiannual coupons if this bond is currently trading for a price of $ 4836?

A. 5.15% B. 7.21% C. 2.58% D. 6.18%

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Answer 1

Answer #1

Correct answer: A. 5.15%

Please refer to below spreadsheet for calculation and answer. Cell reference also provided.

B $5,000.00 4.40% Par value of Bond Coupon rate Coupon frequency Years until maturity Current price of Bond $4,836.00 Yield t

Cell reference -

A BC Par value of Bond Coupon rate Coupon frequency Years until maturity Current price of Bond 5000 0.044 2 4836 Yield to mat

Hope it will help, please do comment if you need any further explanation. Your feedback would be highly appreciated.

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Answer 2

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