What is the yield to maturity

Reference no: EM133665308

Problem

1) Andy "Big Red" Reid is considering purchasing a bond that pays annual coupons at a rate of 3 percent and matures in 11 years. If the YTM on this bond is 4 percent, how much should Big Red pay for this bond if he purchases the bond today?

2) Noles Manufacturing has 3 percent coupon bonds on the market with 13 years left until maturity. The bond makes annual payments. If the bond sells for $838.07, what is the yield to maturity?

Reference no: EM133665308

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