Bond yields and coupon rates
If r1=0.1, r2 = 0.11, and r3 = 0.09, the price is $1,021.47. Yield To Maturity. Suppose a 3 year, 8% coupon rate, $1000 face value bond is selling for $949.22. What The issuer promises to repay the loan on a future date, known as the maturity date. Let's look at a bond with a $1,000 par value, a 5% coupon rate and 3 years to The price of a bond is the Present Value of all cash flows generated by the bond ( i.e. coupons and face value) discounted at the required rate of return. PV cpn r.