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Yield to maturity Each of the bonds shown in the following table pays interest annually. LG 6 LG 6 a. Calculate the yield to maturity

Yield to maturity Each of the bonds shown in the following table pays interest annually.

LG 6

a. Calculate the yield to maturity (YTM) for each bond.

b. What relationship exists between the coupon interest rate and yield to maturity

and the par value and market value of a bond? Explain.Bond Par value Coupon interest rate Years to maturity Current value A $1,000 9% 8 $ 820 B 1,000 12 16 1,000 C 500 12 12 560 D 1,000 15 10 1,120 E 1,000 5 3 900

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