Otto Enterprises has a 15-year bond issue outstanding that pays a 9% coupon.The bond is currently priced at $894.60 and has a par value of $1,000.Interest is paid semiannually.What is the yield to maturity?

Question

Quizplus · Accepted Answer

This cannot be solved directly,so it's easiest to just use the calculator method to get an answer.You can then use the calculator answer as the rate in the formula just to verify that your answer is correct.Answer is 10.40% (rounded)

Otto Enterprises Has a 15-Year Bond Issue Outstanding That Pays