what is the coupon rate on a bond with the following terms: 10 years,$1,000 par value,...

Question

Question

what is the coupon rate on a bond with the following terms: 10 years,$1,000 par value, $1,400 present value and 6% yield to maturity?

Ans is 11% Please explain step by step with excel

business finance

Answer 1

Answer #1

The coupon rate is calculated using the PMT function as follows:-

=PMT(rate,nper,pv,fv)/fv

=PMT(6%,10,-1400,1000)/1000

=11%

Answer 2

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