1) Atlantis Fisheries issues zero coupon bonds on the market at a price of $499

Question

1)

Atlantis Fisheries issues zero coupon bonds on the market at a price of $499 per bond. Each bond has a face value of $1,000 payable at maturity in 12 years. What is the yield to maturity for these bonds? (Round your answer to 2 decimal places. Omit the "%" sign in your response.)

Yield to maturity %

2)

LKD Co. has 14 percent coupon bonds with a YTM of 8.9 percent. The current yield on these bonds is 9.5 percent. How many years do these bonds have left until they mature? (Round your answer to 2 decimal places.)

                

  Bonds mature years

Explanation / Answer

1)

Face value (FV) $                                  1,000.00 Coupon rate 0.00% Number of compounding periods per year 2 Interest per period (PMT)                                                   -   Bond price (PV) $                                   (499.00) Number of years to maturity 12 Number of compounding periods till maturity (NPER) 24 Bond Yield to maturity RATE(NPER,PMT,PV,FV)*2 Bond Yield to maturity 5.88%

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