Question
I'm asked the YTM ( expressed as a nominal rate with quarterly capitalization) of a bond that pays quarterly coupons during a year and a
I'm asked the YTM ( expressed as a nominal rate with quarterly capitalization) of a bond that pays quarterly coupons during a year and a half. The price of the bond is not given, we are told the coupons, starting with the second coupon, grow with inflation (anual inflation is expected to be 6.1364%), the coupon rate is 11% annualy. And we are told that the current return for one year for investors is 12.9186%, investors are expected to generate a 12.9186% return for a dollar invested during the first year. Face Value is $1,000.
Multiple Option question, answer should be one of the following: 18.40% 16.26% 19.47% 17.33% 15.19%
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