Consider a bond with the following characteristics: 30 years to maturity, 9.90% coupon rate (equal to current interest rate), interest paid semi-annually, $1,000 par value, $1,017 call price, and no call protection. If rates change to 4.50% will the company gain from calling the bond? Assume that transaction cost is $170 .

NOTICE: Round ALL calculations to 4 decimal places. Only round what you input in the blank to 2 decimal places. If you get 1.2345 then write 1.23.

The PV of Liability is $   .

The Gain/Loss from calling the bond is $   . If negative (-1) then write (-1).

Would you "call" or "no call" ?