A firm has just issued $1,000 face value bonds with an annual coupon rate of 8%, paid semi-annually, and a maturity of 10 years. If the issue price for this is $770.6 what is the yield-to-maturity, stated annually?© BrainMass Inc. brainmass.com March 4, 2021, 6:08 pm ad1c9bdddf
The yield to maturity can be calculated by trial and error method or by using Excel function RATE
Yield to maturity= 6.00% semi annualy
Stated annually= 12.00%
Answer: = 12.00%
PVIFA( n, r%)= =[1-1/(1+r%)^n]/r%
PVIF( n, ...
The solution calculates Yield to maturity of a bond.