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1. Suppose you are looking to buy a 4.5% Callable Corporate Bond today (settle is 04/27/2021). The price is quoted at 111.45% of par and
1. Suppose you are looking to buy a 4.5% Callable Corporate Bond today (settle is 04/27/2021). The price is quoted at 111.45% of par and the maturity is 2/14/2045. The first callable date is 2/14/2030 at a call premium of 15% (i.e. call price of 115% of par). a. What is the YTM? (7 points) b. What is the YTC? (7 points) c. What is the expected yield? (7 points) d. As of today, is the bond likely to be called on the first callable data? Explain why or why not. (7 points) 1. Suppose you are looking to buy a 4.5% Callable Corporate Bond today (settle is 04/27/2021). The price is quoted at 111.45% of par and the maturity is 2/14/2045. The first callable date is 2/14/2030 at a call premium of 15% (i.e. call price of 115% of par). a. What is the YTM? (7 points) b. What is the YTC? (7 points) c. What is the expected yield? (7 points) d. As of today, is the bond likely to be called on the first callable data? Explain why or why not. (7 points)
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