If a bond's yield-to-maturity equals its nominal yield, what is the bond's price?

When a bond's yield-to-maturity (YTM) equals its nominal yield (also known as the coupon rate), this indicates that the bond is being sold at par value. The par value of most bonds is typically set at 100.

The nominal yield reflects the interest rate stated on the bond, which is the annual interest payment divided by the bond's face value. The yield-to-maturity considers the total returns an investor can expect if the bond is held until maturity, factoring in its current market price, interest payments, and any capital gains or losses that may result from the bond’s redemption at face value.

When YTM is equal to the nominal yield, this balance means that the current market price of the bond is equal to its face value. In other words, investors are willing to pay exactly what the issuer originally set the bond at, leading to a price of 100. This scenario typically occurs when market interest rates are stable and aligned with the fixed rate offered by the bond, making it neither a discount nor a premium compared to its face value.

Thus, if the bond's yield-to-maturity equals its nominal yield, it is clear that the bond is priced at par value, which is 100.