Bond Yield Practice Problems

by Pamela Peterson Drake
  1. Suppose a bond has a price today of $800, a coupon rate of 4%, and six years remaining to maturity. If interest is paid semi-annually, what is this bond's yield to maturity?

  2. Suppose a bond has a price today of $800, a coupon rate of 4%, and six years remaining to maturity. If interst is paid annually, what is this bond's yield to maturity?

  3. The 6% coupon rate ABC bond has a price of $1,050, interest paid semi-annually, and two years remaining to maturity. What is the ABC bond's yield to maturity?

  4. Suppose a bond has a price today of $1,000, a coupon rate of 5% and size years remaining to maturity. If interest is paid annually, what is this bond's yield to maturity?

Solutions