Bond valuation-what is yield to maturity

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BOND VALUATION

Madsen Motors's bonds have 5 years remaining to maturity. Interest is paid annually; they have a $1,000 par value; the coupon interest rate is 9%; and the yield to maturity is 7%. What is the bond's current market price? Round your answer to the nearest cent.

YIELD TO MATURITY AND FUTURE PRICE

A bond has a $1,000 par value, 12 years to maturity, and a 8% annual coupon and sells for $980.

What is its yield to maturity (YTM)? Round your answer to two decimal places.

%

Assume that the yield to maturity remains constant for the next 4 years. What will the price be 4 years from today? Do not round intermediate calculations. Round your answer to the nearest cent.

$

Reference no: EM132015521

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