Question
5. A firms bonds have a maturity of 8 years with a $1,000 par value,, have an 11% coupon rate, are callable in 4 years
5. A firms bonds have a maturity of 8 years with a $1,000 par value,, have an 11% coupon rate, are callable in 4 years at $1,154 and currently sell at a price of $1,283.09. Suppose the coupon payments are made quarterly.
(Hints: a. Yield to maturity: Video 2 of Chapter 7 from 8:01 to 10:18 on D2L b. yield to call: watch Video 2 of Chapter 7 from 11:05 to 12:54 on D2L)
a) What is the yield to maturity?
N= I/YR= PMT= FV= PV=
Yield to maturity=
b) What is the yield to call?
N= I/YR= PMT= FV= PV=
Yield to call=
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Short Term Financial Management
Authors: Ned C. Hill, William L. Sartoris
3rd Edition
0023548320, 978-0023548321
