Essentials of Investments- Bodie, Kane and Marcus.
1. A bond that sells for $ 957 at three years make annual payments of coupons at 8%. The interest rate for the next three years is estimated at: 8%, 10% and 12%, respectively. Calculate:
a) The YIELD TO MATURITY of the bond
b) The effective return at the end of the period (remember that it is compound interest)