If the yield to maturity is 5.5%,what is the price of a 15-year,zero-coupon bond with a par value of $1,000?

Question

Quizplus · Accepted Answer

The formula to calculate the price of a zero-coupon bond is:

Price = Par Value / (1 + Yield to Maturity)^(Number of Years to Maturity)

Plugging in the given values, we get:

Price = 1000 / (1 + 0.055)^15
Price = 1000 / 1.896
Price = $527.88

Therefore, the correct answer is C) $447.93.

If the Yield to Maturity Is 5