Collingwood Homes has a bond issue outstanding that pays an 8.5 percent coupon and matures in 16.5 years. The bonds have a par value of $1,000 and a market price of $944.30. Interest is paid semiannually. What is the yield to maturity?

EBK CFIN
6th Edition
ISBN:9781337671743
Author:BESLEY
Publisher:BESLEY
Chapter6: Bonds (debt) - Characteristics And Valuation
Section: Chapter Questions
Problem 12PROB
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Problem 4
Collingwood Homes has a bond issue outstanding that pays an 8.5 percent coupon and
matures in 16.5 years. The bonds have a par value of $1,000 and a market price of $944.30.
Interest is paid semiannually. What is the yield to maturity?
Transcribed Image Text:Problem 4 Collingwood Homes has a bond issue outstanding that pays an 8.5 percent coupon and matures in 16.5 years. The bonds have a par value of $1,000 and a market price of $944.30. Interest is paid semiannually. What is the yield to maturity?
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