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10. Suppose that today is July 16, 2001 and you are given the following data on ABC's publicly traded debt. Suppose that ABC does not
10. Suppose that today is July 16, 2001 and you are given the following data on ABC's publicly traded debt. Suppose that ABC does not have any other form of debt. Coupon Issued Maturity Current PriceS 95.60 6.75% paid semi-annually 07/15/96 07/15/21 What is the yield to maturity on ABC's debt? Express the YTM both in terms of APR and EAR Suppose ABC's debt is rated BBB. An analyst estimated ABC's debt cost of capital by assuming that it equals the YTM on ABC's debt. Is the analyst likely to overestimate or underestimate ABC's debt cost of capital? a. b
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