This paper re-works the traditional formula for pricing a bond with a present value annuity and a single discounted cash flow into a "one-step' bond pricing formula. The new derivation allows for a clear presentation of the relationship between a bond's coupon yield and its yield to maturity and a quick means for pricing a bond.

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Copyright © 2015 Financial Education Association. This article first appeared in Advances in Financial Education 13 (2015), 22-25.

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