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A 8 year $18000 par-valued bond pays monthly coupons. If the yield rate is y(12) =...

A 8 year $18000 par-valued bond pays monthly coupons. If the yield rate is y(12) = 10% and the purchase price is $11475.75, what is the coupon rate c(12)?

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Answer #1

Answer is 3.40%

we need to Find PMT using PMT funtion

RATE 10%/12 0.83%
NPER 8*12 96
PV -11475.8
FV 18000
PMT(.83%,96,-11475.8,18000) Rs. 51.00
So Coupon Payment rate =(51*12)/18000 3.40%
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