Suppose East Coast Yachts issues the coupon bonds with a make-whole call provision. The make-whole call rate
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Suppose East Coast Yachts issues the coupon bonds with a make-whole call provision.
The make-whole call rate is the Treasury rate plus 0.40 percent. If East Coast calls the bonds in 7 years when the Treasury rate is 5.6 percent, what is the call price of the bond?
What if it is 9.1 percent?
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