Answered: What is the YTM for a zero coupon bond…

What is the YTM for a zero coupon bond ($1,000 par) maturing 18 months and 15 days from now selling for $900 today. Use semiannual rate approach. A. 7.19% B. 8.41% C. 6.94% D. 6.53% E. 7.81%

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter4: Bond Valuation

Section: Chapter Questions

Problem 14P: Current Yield with Semiannual Payments A bond that matures in 7 years sells for $1,020. The bond has...

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Question

What is the YTM for a zero coupon bond ($1,000 par) maturing 18 months and 15 days from now selling for $900 today. Use semiannual rate approach.

A. 7.19%
B. 8.41%
C. 6.94%
D. 6.53%
E. 7.81%

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