The yield of a bond is the interest rate that makes the present value of its cash
Question:
The yield of a bond is the interest rate that makes the present value of its cash flows equal to its selling price. Assume a bond can be purchased for $975 and generates the following cash flows:
Use Solver to determine the yield for this bond. (In Excel, use the NPV() function to compute the present value of the cash flows.) What is the yield on thisbond?
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Years from now 2 3 4 5 Cash Flow $100 $120 $90 $100 $1,200
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Spreadsheet Modeling And Decision Analysis A Practical Introduction To Business Analytics
ISBN: 1233
8th Edition
Authors: Cliff T. Ragsdale
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