Yield to Call and Realized Rates of Return Nine years ago, Goodwynn & Wolf Incorporated (G&W) sold
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Yield to Call and Realized Rates of Return
Nine years ago, Goodwynn & Wolf Incorporated (G&W) sold a 16-year bond issue with a 11% annual coupon rate and a 10% call premium. Today, G&W called the bonds. The bonds originally were sold at their face value of $1,000.
Compute the realized rate of return for investors who purchased the bonds when they were issued and who surrender them today in exchange for the call price. Round your answer to two decimal places.
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Related Book For
Financial management theory and practice
ISBN: 978-1439078099
13th edition
Authors: Eugene F. Brigham and Michael C. Ehrhardt
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