What is the yield to maturity of a one-year,risk-free,zero-coupon bond with a $10,000 face value and a price of $9600 when released?

Name: What is the yield to maturity of a one-year,risk-free,zero-coupon bond with a $10,000 face value and a price of $9600 when released?
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Quizplus · Accepted Answer

The yield to maturity (YTM) for a zero-coupon bond is calculated using the formula: YTM = [(Face Value / Price)^(1/Number of Years)] - 1. For this bond, YTM = [($10,000 / $9,600)^(1/1)] - 1 = 0.04167 or 4.167%.

What Is the Yield to Maturity of a One-Year,risk-Free,zero-Coupon Bond