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A 30-year maturity, 8% coupon bond paying coupons semi annually is callable in five years at a call price of $1,100. The bond currently sells at a...

A 30-year maturity, 8% coupon bond paying coupons semi annually is callable in five years at a call price of $1,100. The bond currently sells at a yield to maturity of 7%

(3.5% per half-year).


a. What is the yield to call?

b. What is the yield to call if the call price is only $1,050?

c. What is the yield to call if the call price is $1,100 but the bond can be called in two years instead of five years?

Top Answer

a The yield to call= 6.74% b. The yield to call if the... View the full answer

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Other Answers

Yield to call (YTC) = [CI + (CP - MP) / N] / [(CP + MP) / 2] CI: Annual coupon interest = $1,000 x 8% = $80  MP: Market... View the full answer

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