You just purchased an investment at a price of $1250. You will receive $1900 at the...

You just purchased an investment at a price of $1250. You will receive $1900 at the end of 8 years. If the interest rate is compounded semi-annually, what is your yield to maturity? Do not write any symbol (%, $, #, &,...). Express your answers as a percentage. Round your answer to the nearest one-hundredth percentage point. For example, write 12.56 for 12.56%.

Expert Solution

we have to use financial calculator to solve this
put in calculator

FV		1900
PV		-1250
PMT		0
N	8*2	16

Compute I		2.65%

YTM = 2.65%*2		5.30%

Ans = 5.30

jeff jeffy answered 3 years ago

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