A risk-free, zero-coupon bond with a $10,000 face value has 15 years to maturity. The bond currently trades at $8,860. What is the yield to maturity of this bond?

Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter4: Bond Valuation
Section: Chapter Questions
Problem 8MC: Suppose a 10-year, 10% semiannual coupon bond with a par value of 1,000 is currently selling for...
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A risk-free, zero-coupon bond with a $10,000 face
value has 15 years to maturity. The bond currently
trades at $8,860. What is the yield to maturity of
this bond?
Transcribed Image Text:A risk-free, zero-coupon bond with a $10,000 face value has 15 years to maturity. The bond currently trades at $8,860. What is the yield to maturity of this bond?
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