Question
A 2-year bond with par value $1,000 making annual coupon payments of $80 is priced at $1,000. a. What is the yield to maturity of
A 2-year bond with par value $1,000 making annual coupon payments of $80 is priced at $1,000. a. What is the yield to maturity of the bond? (Round your answer to 1 decimal place.)
b. What will be the realized compound yield to maturity if the 1-year interest rate next year turns out to be (i) 10%, (ii) 12%, (iii) 14%? (Round your answers to 2 decimal places.)
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Advanced Accounting
Authors: Joe Hoyle, Thomas Schaefer, Timothy Doupnik
10th edition
0-07-794127-6, 978-0-07-79412, 978-0077431808
