Question
A 2-year bond with par value $1,000 making annual coupon payments of $116 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 $116 is
priced at $1,000.
(a) What is the yield to maturity of the bond?
(b) What will be the realized compound yield to maturity if the 1-year interest
rate next year turns out to be
r Realized Yield
(a) 7%
(b) 10%
(c) 13%?
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Financial Management
Authors: Geoffrey Knott
4th Edition
1403903824, 9781403903822
