Yields of a Bond A 2.50 percent coupon municipal bond has 12 years left to maturity and

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Yields of a Bond A 2.50 percent coupon municipal bond has 12 years left to maturity and has a price quote of 98.45. The bond can be called in four years. The call premium is one year of coupon payments. Compute and discuss the bond's current yield, yield to maturity, taxable equivalent yield (for an investor in the 35 percent marginal tax bracket), and yield to call. (Assume interest payments are semiannual and a par value of $5,000.) (LG6)

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Finance Applications And Theory

ISBN: 9780073530673

2nd Edition

Authors: Marcia Cornett, Troy Adair, John Nofsinger

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