The gm bond trades at 9495 percent of par what is the yield


1. Draw a cash flow that starts at $100 one year from now and increases by $100 every year after that for a total of 5 years with an interest rate of 4% compounded annually. What is the present value of this cash flow?

2. A GM and a Ford bond both have 4 years to maturity, a $1,000 par value, a BB rating and pay interest semiannually. GM has a coupon rate of 6.5%, while Ford has a coupon rate of 5.4%.

The GM bond trades at 94.95 (percent of par). What is the yield to maturity (YTM)?

What should be the price of the Ford bond (in $)?

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Financial Management: The gm bond trades at 9495 percent of par what is the yield
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