calculate the yield to maturity on a loan for a $12,000 that requires month payments of...

Question

Question

calculate the yield to maturity on a loan for a $12,000 that requires month payments of $127.28 for 10 years.

**please show how you get this**

business finance

Answer 1

Answer #1

You can calculate it through I/Y function on a financial calculator

Insert N = 10 x 12 = 120, PMT = 127.28, PV = -12,000, FV = 0

=> Compute I/Y = 0.42% (monthly)

Annualized YTM = 0.42% x 12 = 5.00%

Answer 2

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