Question: Can you help me understand this example and how to calculate it? I'm using a financial calculator but not coming up with the same results

Can you help me understand this example and how to calculate it? I'm using a financial calculator but not coming up with the same results as this example.

Example: Calculating YTM with invoice prices

What is the YTM of a bond with: $1,000 par, 8%

coupon, 7 years to maturity, and $1,112.96 price?

- n : 7 2 = 14

- PMT : 8% 1000 = $40

- FV : par = $1,000

- PV : price = 1,112.96

- hit i on calculator, and get 3.00%

Since this is a semi-annual rate, YTM = 2 3.00 = 6.00%

Remark: The effective annual yield is (1.03)2 - 1 = 6.09%

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