A Tesla coupon bond with a face value of $1,000 has a coupon rate of 6% with annual coupons and it will mature in 5 years. If it is currently trading at $844.2, what is its yield-to-maturity? Round to the tenth of a percent (e.g., 4.32% = 4.3) [Hint: Use Excel's "rate" function as explained in the text. Make sure you set the cell to show decimal places.]

EBK CFIN
6th Edition
ISBN:9781337671743
Author:BESLEY
Publisher:BESLEY
Chapter5: The Cost Of Money (interest Rates)
Section: Chapter Questions
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A Tesla coupon bond with a face value of $1,000 has a coupon rate of 6% with annual coupons and it will mature in 5 years. If it is
currently trading at $844.2, what is its yield-to-maturity? Round to the tenth of a percent (e.g., 4.32% = 4.3) [Hint: Use Excel's
"rate" function as explained in the text. Make sure you set the cell to show decimal places.]
Transcribed Image Text:Question 5 Homework • Unanswered A Tesla coupon bond with a face value of $1,000 has a coupon rate of 6% with annual coupons and it will mature in 5 years. If it is currently trading at $844.2, what is its yield-to-maturity? Round to the tenth of a percent (e.g., 4.32% = 4.3) [Hint: Use Excel's "rate" function as explained in the text. Make sure you set the cell to show decimal places.]
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