1. To prepare for the meeting, create a summary of the yields of each bond by...

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1. To prepare for the meeting, create a summary of the yields of each bond by completing the table shown in Exhibit 13.2. Remember that the YTM of each bond is assumed to be the required rate of return of each bond and that the semiannual YTM must be multiplied by two to get the stated (nominal) YTM. 2. The Chair comments that the 15-year and both 25-year bonds are callable five years from today at $1,050 and asks you for the yield-to-call on each of the three bonds. 3. Finally, the Chair states that most bond market analysts believe that interest rates will remain at the 10 percent level for the next several years. She asks you whether Pacific should consider calling any of its bonds and why. (Hint: No additional calculations are required.) Long-Term Bonds $ 48,000,000 $ 32,000,000 $100,000,000 $ 800.00 $ 865.49 $1,220.00 $1,000 4.50% 12/31/2018 5 A+ $1,000 $ 64,000,000 8.25% $1,000 12.625% 12/31/2038 25 $ 747.48 $1,000 7.375% 12/31/2038 25 12/31/2028 15 A+ A+ A+ EXHIBIT 13.2 Pacific Healthcare: Long-Term Bond Stated Annual 2018 2018 Face Amount (Nominal) Yields Yield to Coupon Current Maturity Payments Yield 1/1/2019 Expected Price 2018 2018 Capital Gain Total Yield Yield $ 48,000,000 $ 32,000,000 $100,000,000 $ 64,000,000 Solve using excel and please include the formulas and steps taken to solve. Thanks! 1. To prepare for the meeting, create a summary of the yields of each bond by completing the table shown in Exhibit 13.2. Remember that the YTM of each bond is assumed to be the required rate of return of each bond and that the semiannual YTM must be multiplied by two to get the stated (nominal) YTM. 2. The Chair comments that the 15-year and both 25-year bonds are callable five years from today at $1,050 and asks you for the yield-to-call on each of the three bonds. 3. Finally, the Chair states that most bond market analysts believe that interest rates will remain at the 10 percent level for the next several years. She asks you whether Pacific should consider calling any of its bonds and why. (Hint: No additional calculations are required.) Long-Term Bonds $ 48,000,000 $ 32,000,000 $100,000,000 $ 800.00 $ 865.49 $1,220.00 $1,000 4.50% 12/31/2018 5 A+ $1,000 $ 64,000,000 8.25% $1,000 12.625% 12/31/2038 25 $ 747.48 $1,000 7.375% 12/31/2038 25 12/31/2028 15 A+ A+ A+ EXHIBIT 13.2 Pacific Healthcare: Long-Term Bond Stated Annual 2018 2018 Face Amount (Nominal) Yields Yield to Coupon Current Maturity Payments Yield 1/1/2019 Expected Price 2018 2018 Capital Gain Total Yield Yield $ 48,000,000 $ 32,000,000 $100,000,000 $ 64,000,000 Solve using excel and please include the formulas and steps taken to solve. Thanks!