May Industries has a bond outstanding that sells for $780. The bond has a coupon
ID: 2773198 • Letter: M
Question
May Industries has a bond outstanding that sells for $780. The bond has a coupon rate of 7.20 percent and 11 years until maturity. What is the yield to maturity of the bond? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Omit the "%" sign in your response.)
May Industries has a bond outstanding that sells for $780. The bond has a coupon rate of 7.20 percent and 11 years until maturity. What is the yield to maturity of the bond? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Omit the "%" sign in your response.)
Explanation / Answer
May Industries has a bond outstanding that sells for $780. The bond has a coupon rate of 7.20 percent and 11 years until maturity. What is the yield to maturity of the bond? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Omit the "%" sign in your response.)
YTM = rate(nper,pmt,pv,fv)
Nper (indicates the period) = 11
PV (indicates the price) = -780
PMT (indicate the annual payment) = 1000*7.2% = 72
FV (indicates the face value) = 1000
Rate (indicates YTM) = ?
YTM = rate( 11,72,-780,1000)
YTM = 10.70%