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Please show all work Yield to maturity. (a) Find the yield to maturity on a 1-month T-bill...

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Finance

Please show all work

Yield to maturity. (a) Find the yield tomaturity on a 1-month T-bill with $100,000 face value that sold fora price of $99,667.77.

Answer: i = 0.04

(b) Consider a loan of $400,000 to be repaid with annualpayments over 25 years. Find the fixed payments that would berequired for the yield to maturity on the loan to be 6%.

Answer: FP = $31,290.68.

(c) Consider a loan of $200,000 to be repaid with annualpayments over 30 years. If the annual fixed payments are$19,467.28, then what is the yield to maturity on the loan? Showyour work.

Answer: i = 0.09

Answer & Explanation Solved by verified expert
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Calculate the yield to maturity as followsYield to maturity Face value Issue price FacevalueNumber of months in a    See Answer
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Transcribed Image Text

Please show all workYield to maturity. (a) Find the yield tomaturity on a 1-month T-bill with $100,000 face value that sold fora price of $99,667.77.Answer: i = 0.04(b) Consider a loan of $400,000 to be repaid with annualpayments over 25 years. Find the fixed payments that would berequired for the yield to maturity on the loan to be 6%.Answer: FP = $31,290.68.(c) Consider a loan of $200,000 to be repaid with annualpayments over 30 years. If the annual fixed payments are$19,467.28, then what is the yield to maturity on the loan? Showyour work.Answer: i = 0.09

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