Find the Yield to Maturity for a bond that is currently selling at $1,090 and has the
following characteristics: (a) NPER—30 and (b) Coupon Payments--$70
Using Excel's RATE() function:
NPER... 30 (This is the number of periods to maturity.)
PMT..... ($70.00) (This is the coupon interest payment.)
PV..... $1,090.00 (This is the current selling price of the bond.)
FV..... ($1,000.00) (This is the par or face value of the bond .)
TYPE 0. (Input 0 or 1. 0 or blank means ordinary annuity. 1 means annuity due.)
GUESS... 6.00% (Input any interest here if cell C16 is returning error message.)
RATE ..... 6.32% (Type formula here: = PV(rate, nipper, pmt, fv, type)

  • CreatedSeptember 19, 2013
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