Soprano’s Spaghetti Factory issued 18-year bonds two years ago at a coupon rate

Question

Soprano’s Spaghetti Factory issued 18-year bonds two years ago at a coupon rate of 6.50 percent. If these bonds currently sell for 94.95 percent of par value, what is the YTM? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Omit the "%" sign in your response.) YTM %

Atlantis Fisheries issues zero coupon bonds on the market at a price of $443 per bond. If these bonds are callable in 5 years at a call price of $511, what is their yield to call? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Omit the "%" sign in your response.) Yield to call %

Atlantis Fisheries issues zero coupon bonds on the market at a price of $522 per bond. Each bond has a face value of $1,000 payable at maturity in 16 years. What is the yield to maturity for these bonds? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Omit the "%" sign in your response.) Yield to maturity %

Explanation / Answer

Answer: Calculation of the YTM

94.95=$6.5*PVIFA(r%,16)+$100*PVIF(r%,16)

r=7.04%

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