Niendorf Corporation's 25-year maturity bonds have an 8.75% coupon rate with interest paid semiannually, and a par value of $1,000. The bonds are currently selling at a premium price of $1,250 in the bond market. What is their yield to maturity (YTM)? Enter your answer rounded to two decimal places. Do not enter % in the answer box. For example, if your answer is 0.12345 or 12.345% then enter as 12.35 in the answer box.
K = Nx2 |
Bond Price =∑ [(Semi Annual Coupon)/(1 + YTM/2)^k] + Par value/(1 + YTM/2)^Nx2 |
k=1 |
K =25x2 |
1250 =∑ [(8.75*1000/200)/(1 + YTM/200)^k] + 1000/(1 + YTM/200)^25x2 |
k=1 |
YTM% = 6.68 |
Niendorf Corporation's 25-year maturity bonds have an 8.75% coupon rate with interest paid semiannually, and a...
A 10-year, $1,000 par value bond has a 6.25% coupon rate with interest paid semiannually. The bond currently sells for $875. What is the capital gains yield on these bonds? Enter your answer rounded to two decimal places. Do not enter % in the answer box. For example, if your answer is 0.12345 or 12.345% then enter as 12.35 in the answer box.
A 10-year, $1,000 par value bond has a 6.75% coupon rate with interest paid semiannually. The bond currently sells for $875. What is the capital gains yield on these bonds? Enter your answer rounded to two decimal places. Do not enter % in the answer box. For example, if your answer is 0.12345 or 12.345% then enter as 12.35 in the answer box.
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