Question
Please reference first portion to solve for the second part starting at suppose the government bond that is the portion that needs to be solved.
Please reference first portion to solve for the second part starting at "suppose the government bond" that is the portion that needs to be solved. see 2
A government bond is currently selling for 1,195 and pays 75.00 per year in interest for 14 years when it matures. If the redemption value of this bond is 1,000 dollars, what is its yield to maturity if purchased today at 1,195?
2. suppose the government bond above in problem one is held for five years and a savings institution acquired a bond and deciedes to sell it at 940.00. What is the average annual yield the savings instiution will have earned for its five year investment in the bond?
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