You are given the following information from a T-Note quote: Settlement date: September 15, 2017 Maturity...

You are given the following information from a T-Note quote:

Settlement date: September 15, 2017

Maturity date: September 15, 2032

Price Quote: 102:9

In excel, compute and graph the coupon rates and current yields for yields-to-maturity of 1% to 10%, in 1% increments. Which of the following accurately depicts this calculation?

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Expert Solution

It is assumed that the coupon frequency is annual

The annual coupon payment is calculated using PMT function in Excel :

rate = YTM

nper = 15 (there are 15 years left to maturity)

pv = -102.9 (current price of note)

fv = 100 (face value of note)

Coupon rate = coupon payment / 100

current yield = coupon payment / current price of note

jeff jeffy answered 1 month ago

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