Calculating the YTM - coupon bond

Question: Find the YTM of this coupon bond.

coupon = 5%
maturity = 3 years
interest rates: r1 = 3%; r2 = 4%; r3 = 4.5%
face value: 100%
Price of coupon is: P0 = 101,49 %

Solution: YTM= 4,459%

I guess using the Excel Solver function could be useful?

any help much appreciated! :slight_smile:

On the BAII:

P/Y=C/Y=1
2nd FV (to clear out the TVM worksheet)
3 N -101.49 PV 5 PMT 100 FV CPT I/Y 4.458402

P.S.: You canโ€™t bring a laptop into the exam with you, but they do let you bring in an approved calculator!!!

If you want to do it in Excel, use the RATE function; itโ€™s easier than using Solver.

Thank you both very much for your fast help! , everything clear now! :smile:

Good to know.

My pleasure.