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    Zero-coupon bonds

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    I need help in figuring out the attached finance problem:

    Bond Pricing: Fill in the table below for the following zero-coupon bonds. The face value of each bond is $1,000.

    See attached file for full problem description.

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    Solution Preview

    First scenario (calculating yield to maturity)
    $1,000 = $300 * (1 + YTM)^30
    YTM = (1000/300)^(1/30) - 1 = 0.0409 ...

    Solution Summary

    This solution looks at bond pricing, maturity and yield to maturity for zero-coupon bonds.