# Math Help - Coupon Rate

1. ## Coupon Rate

Corporate bonds are selling today for $1003.17 and mature in 3 years (interest annually) with YTM of 6.63%. Find the coupon rate. $P = c * \frac{{1 - \frac{1}{(1+YTM)^n}}}{YTM} + f * \frac{1}{(1+YTM)^n}$ where P = price, c = coupon value, f = face value $1003.17 = c * \frac{{1 - \frac{1}{(1.0663)^3}}}{.0663} + f * \frac{1}{(1.0663)^3}$ I can't seem to isolate c and f as a fraction to calculate for the coupon rate: $Coupon Rate = \frac{c}{f}$ 2. Originally Posted by Macleef Corporate bonds are selling today for$1003.17 and mature in 3 years (interest annually) with YTM of 6.63%. Find the coupon rate.

$P = c * \frac{{1 - \frac{1}{(1+YTM)^n}}}{YTM} + f * \frac{1}{(1+YTM)^n}$

where P = price, c = coupon value, f = face value

$1003.17 = c * \frac{{1 - \frac{1}{(1.0663)^3}}}{.0663} + f * \frac{1}{(1.0663)^3}$

I can't seem to isolate c and f as a fraction to calculate for the coupon rate: $Coupon Rate = \frac{c}{f}$
First, isolate C. After that, you should only have C on the left hand side. Then divide both sides by f.

3. $\frac{1003.17 - \frac{1}{(1.0663)^3)}f}{\frac{1 - \frac{1}{1.0663^3}}{.0663}} = c$

$20.9297073f = c$

$20.9 = \frac{c}{f}$

That's the number I get and it's wrong, what am I doing wrong?