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Curtis Corporation's noncallable bonds currently sell for $1,165. They have a 15-year maturity, an annual coupon of $95, and a par value of $1,000. What is their yield to maturity

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tutordamola

Answer:

The answer is 7.61%

Explanation:

N(Number of periods) = 15 years

I/Y(Yield to maturity) = ?

PV(present value or market price) = $1,165

PMT( coupon payment) = $95

FV( Future value or par value) = $1,000.

We are using a Financial calculator for this.

N= 15; PV = -1165; PMT = 95; FV= $1,000; CPT I/Y= 7.61

Therefore, the Yield-to-maturity of the bond is 7.61%