Question
Create a spreadsheet to price a 5 year and 10 year annual pay UST. Assume the coupon = 3.50%, and the yield to maturity (ytm)
Create a spreadsheet to price a 5 year and 10 year annual pay UST. Assume the coupon = 3.50%, and the yield to maturity (ytm) is 3.50%. Face Value = $1000
a. What is the price (present Value = PV) for both?
b. Now use a 4.50% ytm (i.e. a “100bp change in ytm) and recalculate. How much did the price (PV) of both bonds change in % terms?
Please show this work on Excel.
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Engineering Economy
Authors: William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
15th edition
132554909, 978-0132554909
