Calculate the yield to maturity of a zero coupon bond with a face value of $1000,maturing in 15 years and selling for a price of $525.75.
A) 5.62%
B) 4.38%
C) 8.74%
D) 15.26%
E) 16.27%

Name: Calculate the yield to maturity of a zero coupon bond with a face value of $1000,maturing in 15 years and selling for a price of $525.75. A) 5.62% B) 4.38% C) 8.74% D) 15.26% E) 16.27%
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Question

Quizplus · Accepted Answer

Solve for i
1000 = 525.75(1 + i)¹⁵
i = (1000/525.75)¹/¹⁵ -1 = .0438

Calculate the Yield to Maturity of a Zero Coupon Bond