Bond Coupon Rate
Homework Answers
Semiannual bond. SO each year has 2 periods. SO nper = 30 yr = 30*2=60 periods
Investor yield = YTM = Rate = 7.75%. So Semiannaul yield = 7.75%/2
So HY Coupon payment = PMT(Rate,nper,PV,FV) = PMT(7.75%/2,60,-1107.20,1000)
ie HY PMT = $43.38
So Annual Payment = 2*$43.38 = $86.75
So COupon Rate = PMT/FV = 86.75/1000 = 8.675%
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