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A bond currently sells for $1,250. It pays a $110 annual coupon and has a 20-year maturity, but it can be called in 5 years
A bond currently sells for $1,250. It pays a $110 annual coupon and has a 20-year maturity, but it can be called in 5 years at $1,110. [Par value of bond is generally $1,000. If par value is not given in the problem, assume it is $1,000.]
(a) What are its YTM and (b) its YTC?
(c) Is it likely to be called if interest rates dont change?
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Foundations Of Financial Management
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen
17th Edition
126001391X, 978-1260013917
