Bond valuation question
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McDonalds Corporation has 8 percent coupon bonds on the market with 9 years left to maturity. The bonds make annual payment. If the bond currently sells for $910.85, what is the yield to maturity? Is the bond selling at a discount or premium?
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Solution Summary
The solution explains the calculation of yield to maturity of a bond.
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The Yield to Maturity (YTM) is the discount rate that will make the present value of interest and principal equal to the price today. The annual interest is $80, maturity is 9 ...
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