The price today of a 4-year coupon bond with annual coupons, a coupon rate of 6%, and a face value of $1000, is $1,113.18. Coupons will be paid starting one year from now, up to and including the time when the bond matures, in four years. Calculate the yield to maturity of this coupon bond.

The price today of a 4-year coupon bond with annual coupons, a coupon rate of 6%, and a face value of $1000, is $1,113.18. Coupons will be paid starting one year from now, up to and including the time when the bond matures, in four years. Calculate the yield to maturity of this coupon bond.

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter4: Bond Valuation

Section: Chapter Questions

Problem 12P: Bond Yields and Rates of Return A 10-year, 12% semiannual coupon bond with a par value of 1,000 may...

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