YTM can also be calculated directly in the spreadsheet using the function=YIELD (Al, A2, An) where n is the last cell with inputs for the problem. The user inputs settlement date, maturity date, coupon rate, current bond price, maturity value (par value), and the number of coupons paid per year. You can set the settlement date as the current date, and the maturity date as the same month and day in the year of maturity (five years from now, eight years from now, etc.) Price is stated as a percentage of par (e.g., 100 = $1,000). The following format solved the ytm for the bond in Example 17—3.

1/1/2007 Settlement date = YEAR (year, month, day)*
1/1/2010 Maturity date = YEAR (year, month, day)*
0.1 Annual coupon rate
105.242 Bond price
100 Face value = par value
2 Coupon payments per year
0.08 Yield to maturity as a decimal