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Check My Wor 15. eBook 17. o 18. 19. 20. It is now January 1, 2019, and you are considering the purchase of an outstanding

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Check My Wor 15. eBook 17. o 18. 19. 20. It is now January 1, 2019, and you are considering the purchase of an outstanding bond that was issued on January 1, 2017. It has a 9% annual coupon and had a 15- year original maturity. (ft matures on December 31, 2031.) There is 5 years of all protection (until December 31, 2021), after which time it can be called at 108-that is, at 108% of par or $1,080. Interest rates have declined since it was issued, and it is now selling at 111.55% of par, or $1,115.50 a. What is the yield to maturity? Do not round intermediate calculations. Round your answer to two decimal places % What is the yield to call? Do not round intermediate calculations. Round your answer to two decimal places 9 b. If you bought this bond, which return would you actually earn? 1. Investors would expect the bonds to be called and to earn the YTC because the YTC is less than the YTM 11. Investors would expect the bonds to be called and to earn the YTC because the YTC is greater than the YTM III. Investors would not expect the bonds to be caled and to earn the YTM because the YTM is greater than the YTC. I. Investors would not expect the bonds to be called and to earn the YTM because the YTM is less than the VTC -Select- c. Suppose the bond had been sel at a discount rather than a premium. Would the yield to maturity have been the most likely return, or would the yield to call have been most likely I. Investors would expect the bonds to be called and to earn the YTC because the YTC is greater than the YTM II. Investors would expect the bonds to be called and to earn the YTC because the YTC is less than the YTM III. Investors would not expect the bonds to be called and to earn the YTM because the YTM is greater than the YTC. IV. Investors would not expect the bonds to be called and to earn the YTM because the YT is less than the YTC. Select * O 6/23

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