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A bond has a $1,000 par value, 11 years to maturity, and pays a coupon of 4.75% per year, semiannually. The bond can be called in five years at $1,050. If the bond's price is $797.92, what is its annual yield to maturity

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kaympoey08

Answer:

The answer is 7.48

Explanation:

YTM = [(C+ (FV-PV)/t)] / [(FV + PV)/2]

FV = 1,000

PMT = 47.50/2 = 23.75

T= 11

PV = -797.92

CPT I = 3.74

AnnualizeD = 7.48

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