If I have 9 percent coupon bonds on the market that have 8 years left to maturity and the bonds make annual payments. The yield to maturity (YTM) on these bonds is 7 percent, what is the current bond price?
The price is the PV of the remaining cash flows when discounted at the YTM. You've got 8 remaining coupon payments, plus the maturity payoff--discount those and you're good to go.
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