Consider a zero coupon bond that has a current price of $436.19 and matures in 10 years.What is its yield to maturity?
A) 0.86%
B) 8.65%
C) 8.00%
D) 58.80%
E) 6.564%

Name: Consider a zero coupon bond that has a current price of $436.19 and matures in 10 years.What is its yield to maturity? A) 0.86% B) 8.65% C) 8.00% D) 58.80% E) 6.564%
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Price = Par/(1 + YTM)ⁿ
YTM = (Price/Par)¹/ⁿ - 1
YTM = (1000/436.19)¹/¹⁰ - 1 = 8.65%

Consider a Zero Coupon Bond That Has a Current Price