Question: 5. Consider two $10,000 face-value corporate bonds. One is currently selling for $9,950 and matures in 15 years. The other bond sells for $9,150 and

5. Consider two $10,000 face-value corporate bonds. One is currently selling

5. Consider two $10,000 face-value corporate bonds. One is currently selling for $9,950 and matures in 15 years. The other bond sells for $9,150 and matures in 13 years. Calculate the approximate yield to maturity (with the approximate formula below) for both bonds if each has a coupon rate equal to 5%. Assuming a yearly coupon payment, find which bond is a better buy. F-P YTM = [C+ = -]/(0.6 P + 0.4 F) n

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