Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.

Get a Professional Answer

Via email, text message, or notification as you wait on our site. Ask follow up questions if you need to.

100% Satisfaction Guarantee

Rate the answer you receive.

Ask Manal Elkhoshkhany Your Own Question

Manal Elkhoshkhany, Tutor

Category: Homework

Satisfied Customers: 9843

Experience: More than 5000 online tutoring sessions.

3708793

Type Your Homework Question Here...

Manal Elkhoshkhany is online now

A 10-year, $1000 face value bond sells for $925 and has an

This answer was rated:

★★★★★

A 10-year, $1000 face value bond sells for $925 and has an 8% annual coupon rate. 1) What is the bond's current yield? 2) What is the bond's yield to maturity? 3) Assume that the YTM remains constant for the next three years. What will be the price of the bond three years from today?

Your answers are correct. As for part 3, after 3 years, the time to maturity will be 7 years, and as you know, the price of the bond equals the present value of all future cash flows (that includes the PV of Coupon Payments + Present Value of the Face Value).

Greetings! Your spreadsheet did not appear to upload all of the functions correctly? In the Yield To Maturity (B17, B24) and also the Price block (B27), instead of a number, it says "#NAME?", so I am unable to view the answers in those... could you reupload, please? thank you so much!

Still having the same problem- tried opening it from another computer, but with the same results. Could you just tell me what you got for the yield to maturity and the price of the bond three years from now, since those are the only two blocks that aren't showing in the spreadsheet? Then I can figure it out from there... :) Thanks!