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    Current Yield and YTM

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    I have completed the problem but would appreciate it if someone could check my work. Thanks

    9. Bonds of XYZ Corp. with a par value of $1,000 sell for $950, mature in 8 years, and have a 9% annual coupon rate paid semiannually. I used Excel for the YTM.

    Thanks

    Calculate the:
    i. Current yield

    $90 / 950 = 9.47

    ii. Yield to maturity to the nearest whole percent.

    YIELD("04/01/2000","04/01/2009",0.09,95,100,2)
    = 9.85% or 10%

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    Solution Preview

    9. Bonds of XYZ Corp. with a par value of $1,000 sell for $950, mature in 8 years, and have a 9% annual coupon rate paid semiannually. I used Excel for the YTM. ...

    Solution Summary

    This solution is comprised of a detailed explanation to calculate current yield and YTM.

    $2.19