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bond sells for ( $ 1 , 0 9 0 ) . ( Assume that the bond has just been issued. )
bond sells for $ Assume that the bond has just been issued.
The data has been collected in the Microsoft Excel file below. Download the spreadsheet and perform the required analysis to answer the questions below. Do not round intermediate calculations.
a What is the bond's yield to maturity? Round your answer to two decimal places.
b What is the bond's current yield? Round your answer to two decimal places.
c What is the bond's capital gain or loss yield? Round your answer to two decimal places. Use a minus sign to enter a negative value, if any.
d What is the bond's yield to call? Round your answer to two decimal places.
e How would the price of the bond be affected by a change in the going market interest rate? Hint: Conduct a sensitivity analysis of price to changes in the going market interest rate for the bond. Assume that the bond will be called if and only if the going rate of interest falls below the coupon rate. This is an oversimplification, but assume it for purposes of this problem. Round your answers to the nearest cent.
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