Question
AEC Inc. just sold an annual bond for $965 with a coupon interest rate of 9% and a par value of $1,000. If the bond
AEC Inc. just sold an annual bond for $965 with a coupon interest rate of 9% and a par value of $1,000. If the bond has a maturity of 20 years, what will be the bonds yield to maturity?
Now, let us assume that the bond issued by AEC Inc. also contains a call provision that allows the bond to be called at $1,150 in 5 years. If that is the case, what is the bonds yield to call (YTC)?
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Private Equity Value Creation Analysis Volume I
Authors: Michael David Reinard
1st Edition
1736077821, 978-1736077825
