Given:
Face value = $4000
Redemption amount = 4000 * 98% = $3920
Time to maturity (in semiannual periods) = 8 * 2 = 16
Semiannual coupon = 4000 * 9% / 2 = $180
Purchase price = $3760
Hence:
Semiannual yield = RATE (nper, pmt, pv, fv, type) = RATE (16, 180, -3760, 3920, 0) = 4.968%
y2 = 4.968% * 2 = 9.94%
(1 point) Determine the yield rate y2 for the following bond using the method of averages....
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