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The market price is ​$725 for a 9​-year bond ​($1000 par​ value) that pays 11 percent...

The market price is ​$725 for a 9​-year bond ​($1000 par​ value) that pays 11 percent annual​ interest, but makes interest payments on a semiannual basis ​(5.5 percent​ semiannually). What is the​ bond's yield to​ maturity? (round to the nearest cent)

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Answer:

Face value (FV) $                                        1,000
Coupon rate 11.00%
Number of compounding periods per year 2
Interest per period (PMT) $ 55.00
Bond price (PV) $                                   (725.00)
Number of years to maturity 20
Number of compounding periods till maturity (NPER) 18
Bond Yield to maturity RATE(NPER,PMT,PV,FV)*2
Bond Yield to maturity 17.09%

jeff jeffy answered 1 year ago
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