Problem 6-4 Bond Yields [LO 2] The Timberlake-Jackson Wardrobe Co. has 11.2 perc
ID: 2640991 • Letter: P
Question
Problem 6-4 Bond Yields [LO 2]
The Timberlake-Jackson Wardrobe Co. has 11.2 percent coupon bonds on the market with eleven years left to maturity. The bonds make annual payments.
If the bond currently sells for $1,157.26, what is its YTM? (Do not round intermediate calculations.Round your answer to 2 decimal places (e.g., 32.16).)
Problem 6-8 Coupon Rates [LO 2]
Volbeat Corporation has bonds on the market with 16 years to maturity, a YTM of 10.5 percent, and a current price of $943. The bonds make semiannual payments.
What must the coupon rate be on the bonds? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)
The Timberlake-Jackson Wardrobe Co. has 11.2 percent coupon bonds on the market with eleven years left to maturity. The bonds make annual payments.
Explanation / Answer
1. Formula for Yield To maturity:
Bond Price = Par Value