Explore BrainMass

Explore BrainMass

    Calculating coupon rate in the given case

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    Ashes Divide Corporation has bonds on the market with 13.5 years to maturity, a YTM of 9.4 percent, and a current price of $1,075.6. The bonds make semiannual payments. The coupon rate on these bonds must be ??? percent.

    © BrainMass Inc. brainmass.com October 10, 2019, 3:06 am ad1c9bdddf

    Solution Preview

    Face Value of bond=P=$1000
    Number of coupon payments left=n=13.5*2=27
    YTM=r=9.4% /2=4.7% semi annual
    Coupon ...

    Solution Summary

    The solution calculates the coupon rate in the given case.