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A risk-free, zero-coupon bond with a $5000 face value has 15 years to maturity. The bond currently trades at $3750. What is the yield to maturity of this bond?.
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A risk-free, zero-coupon bond with a $5000 face value has 15 years to maturity. The bond currently trades at $3750. What is the yield to maturity of this bond?.

User Callo
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1.936%


Explanation: YTM = (Face Value / Price) 1/n - 1; YTM = ($5000 / $3750 )1/15 - 1 = 1.936 %.

Hope this helps ! :))
User Learnings
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