Your firm has just issued a 15 year $1,000.00 par value, 10% annual coupon bond for a net price of $964.00. What is the yield
to maturity? Use a financial calculator to determine your answer.a. 10.16%b. 10.44%c. 10.49%d. 10.60%
1 answer:
Answer:
c. 10.49%
Explanation:
In this question, we use the Rate formula which is shown in the spreadsheet.
The NPER represents the time period.
Given that,
Present value = $964
Assuming figure - Future value or Face value = $1,000
PMT = 1,000 × 10% = $100
NPER = 15 years
The formula is shown below:
= Rate(NPER;PMT;-PV;FV;type)
The present value come in negative
So, after solving this, the answer is 10.49%
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