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    jvalence's Avatar
    jvalence Posts: 1, Reputation: 1
    New Member
    		  
    #1

    Jul 15, 2008, 12:14 PM
    Coupon rate
    If you have bonds on the market with 12.5 years to maturity, a YTM of 10.8 percent, and a current price of $715.54 and the bonds make semiannual payments. What is the coupon rate?
    wingrun's Avatar
    wingrun Posts: 40, Reputation: 4
    Junior Member
    		  
    #2

    Jul 17, 2008, 01:23 AM
    using a financial calculator input these information:

    N=25 (12.5 years, semiannual coupons)
    I/YR=5.40 (10.8/2 because coupon is semiannual)
    PV=715.54
    FV=1000

    this gives approx $33 of coupon. Verify the calculation as I might be wrong.
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