Calculate the Yield to Maturity of a Zero Coupon Bond

question 77

Multiple Choice

Calculate the yield to maturity of a zero coupon bond with a face value of $1000,maturing in 15 years and selling for a price of $525.75.

• A) 5.62%
• B) 4.38%
• C) 8.74%
• D) 15.26%
• E) 16.27%

Understand and apply different methods for establishing probabilities (method of equal alternatives, method of frequency, intuitive judgment, counting method).

Distinguish between situations where each outcome has a different probability and those where they do not.

Recognize that different methods can yield different probabilities for the same event.

Identify scenarios appropriate for the method of equal alternatives.