1. ABC issued 12-year bonds at a coupon rate of 8% with semi-annual payments. If the bond...

Question:

1. ABC issued 12-year bonds at a coupon rate of 8% with semi-annual payments. If the bond currently sells for $1050 of par value, what is the YTM?

2. ABC issued 12-year bonds 2 years ago at a coupon rate of 8% with semi-annual payments. If the bond currently sells for 105% of par value, what is the YTM?

3. A bond has a quoted price of $1,080.42. It has a face value of $1000, a semi-annual coupon of $30, and a maturity of five years. What is the current yield? What is the yield to maturity?

Coupon
A coupon or coupon payment is the annual interest rate paid on a bond, expressed as a percentage of the face value and paid from issue date until maturity. Coupons are usually referred to in terms of the coupon rate (the sum of coupons paid in a... Face Value
Face value is a financial term used to describe the nominal or dollar value of a security, as stated by its issuer. For stocks, the face value is the original cost of the stock, as listed on the certificate. For bonds, it is the amount paid to the... Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest...