What is the yield to maturity

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Reference no: EM131300140

1. A firm issues an annual bond today with a $1,000 face value, an 8% annual coupon interest rate, and 25-year maturity. An investor purchases the bond for $1,000. What is the yield to maturity (YTM)?

2. Suppose the investor bought the bond described in the previous problem for $900. What is the yield to maturity (YTM)?

Please show calculations based off of a financial calculator, no formulas.

Reference no: EM131300140

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