Question
A callable bond has 15 years to maturity and can be called in 5 years. The bonds coupon rate is 12% with semi-annual coupon payments.
A callable bond has 15 years to maturity and can be called in 5 years. The bonds coupon rate is 12% with semi-annual coupon payments. The par value is $1000. If the bond is called, the call price will be $1100. The bond is currently selling for $985.35
What is the difference between its yield-to-call and yield-to-maturity?
| 1.78% | ||
| 1.52% | ||
| 1.65% | ||
| 0.78% | ||
| 1.03% |
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Understanding financial statements
Authors: Lyn M. Fraser, Aileen Ormiston
9th Edition
136086241, 978-0136086246
