Answered

Welcome to Westonci.ca, the Q&A platform where your questions are met with detailed answers from experienced experts. Join our Q&A platform and get accurate answers to all your questions from professionals across multiple disciplines. Our platform provides a seamless experience for finding reliable answers from a network of experienced professionals.

Qin Corp. issued 15-year bonds two years ago at a coupon rate of 5.1 percent. The bonds make semiannual payments. If these bonds currently sell for 96 percent of par value, what is the YTM

Sagot :

Zviko

Answer:

5.54 %

Explanation:

Most Bonds are expressed per $100. I will use this as the Face Value.

We can then calculate the Yield to Maturity (YTM) of the Bonds as follows :

PV = ($100 x 96 %) = - $96

PMT = ($100 x 5.1 %) ÷ 2 = $2.55

N = (15 - 2) x 2 = 26

FV = $100

P/YR = 2

YTM = ??

Using a Financial Calculator to input the values as above, we get a YTM of 5.54 %

We hope our answers were useful. Return anytime for more information and answers to any other questions you have. We appreciate your time. Please revisit us for more reliable answers to any questions you may have. We're glad you visited Westonci.ca. Return anytime for updated answers from our knowledgeable team.