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3. (10 points) Saint John Corporation has bonds on the market with 14.5 years remaining to maturity, an YTM of 6.8%, and a current price
3. (10 points) Saint John Corporation has bonds on the market with 14.5 years remaining to maturity, an YTM of 6.8%, and a current price of $1,136.50. The face value is $1000.00. The bonds make semi-annual payments. a. What must be the coupon rate on these bonds? b. Use your answer at (a) to explain why this bond is a premium bond. 2 c. If you buy the bond today and hold it till maturity, how much capital gains income and how much dividend income will you earn
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