Question: Suppose you bought a five - year zero - coupon Treasury bond for $ 8 0 0 per $ 1 0 0 0 face value.

Suppose you bought a five-year zero-coupon Treasury bond for $800 per $1000 face value. What is the yield to maturity (annual compounding) on the bond? I am not sure how you are coming up with 4.56%; I am coming up with something different I have tried several different ways to get the answer but I am coming up with 0.6078 or 0.75??

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!