Question: Bond25-yr Yield Rate US Treasury 1.25 MSFT 3.32 CVS 4.19 Boeing 5.9 estimate the value of an annuity that pays $1000 every 5 years over

Bond25-yr Yield Rate

US Treasury 1.25

MSFT 3.32

CVS 4.19

Boeing 5.9

estimate the value of an annuity that pays $1000 every 5 years over the next 25 years (i.e., five total payments) paid by either the U.S. Treasury, Microsoft, CVS, or Boeing.

What is the implied yield to maturity for each security?

(Note: While the yields you have plotted are for coupon bonds, because coupon rates are relatively low, you decide to treat them as zero-coupon yields for this estimation, as you feel the estimation error from such an approximation is small relative to the other noise in the data.)

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