Bonds issued by the Coleman Manufacturing Company have a par value of S1,000, which, of course, is

Question:

Bonds issued by the Coleman Manufacturing Company have a par value of S1,000, which, of course, is also the amount of principal to be paid at maturity. The bonds are currently selling for 5850. They have 10 years remaining to maturity. The annual Interest payment is 8 percent (880).

Compute the approximate yield to maturity, using Formula 10.2 on page 294.

Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...