Determine the yield to maturity of a 6.5% coupon, 30-year maturity, $100 face value bond selling for $108. Assume semiannual compounding.

the yield to maturity is 5.92%

Explanation:

The computation of the yield to maturity is shown below:

Given that

NPER = 30 × 2 = 60

PMT = $100 × 6.5% ÷ 2 = $3.25

Present Value = $108

Future Value = $100

The formula is shown below:

= RATE(NPER:PMT;-PV;FV;type)

After applying the above formula

The yield to maturity is

= 2.96% × 2

= 5.92%

hence, the yield to maturity is 5.92%

you will have $2593.74 in 10 years if you set aside $1,000 at 10%

you will have $9321.91 in 20 years if you set aside $2000 at 8%

you will have $1469.32 in 5 years if you set aside $1000 at 8%

you will have $1296.87 in 10 years if you set aside $500 at 10%

you will have $239.66 in 15 years if you set aside $100 at 6%

you will have $4660.96 in 20 years if you set aside $1000 at 8%