contestada

ashburn corporation issued 10-year bonds two years ago at a coupon rate of 9 percent. the bonds make semiannual payments. if these bonds currently sell for 102 percent of par value, what is the ytm? (do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Respuesta :

The market-required rate of return on bonds with comparable risks is known as the yield to maturity (YTM) of a bond.

This is typically a company's pre-tax cost of debt because the YTM determines the bond's price and any new issue must have a coupon rate equal to the YTM in order to be issued at par.

What does YTM stand for?

The total rate of return that a bond holder anticipates will get if a bond is held until maturity is known as YTM in the case of bonds. Yield to Maturity is calculated using the following formula: Yield to Maturity = [Annual Interest + (FV-Price)/Maturity] (FV + Price)/2

Is YTM the same as the interest rate?

Yield to maturity (YTM) is the overall interest rate that a bondholder who purchases a bond at market value and holds it until maturity will receive. It is, mathematically speaking, the discount rate at which the bond's price is equal to the total of all future cash flows (including principle repayment and coupon payments).

Learn more about yield to maturity here:

https://brainly.com/question/28033398

#SPJ4          

Otras preguntas