(Bond valuation)The

12

-year

$1 comma 000

par bonds of Vail Inc. pay

11

percent interest. The market's required yield to maturity on a comparable-risk bond is

8

percent. The current market price for the bond is

$ 1 comma 130

.

a.Determine the yield to maturity.

b.What is the value of the bonds to you given the yield to maturity on a comparable-risk bond?

c.Should you purchase the bond at the current market price?

Question content area bottom

Part 1

a. What is your yield to maturity on the Vail bonds given the current market price of the bonds?

%

(Round to two decimal places.)