Congratulations, you have been hired as an analyst at the Procter and Gamble Co.(PG).It is November 1, 2020.PG just made a coupon payment (semi-annual) on its"8% 2047" bonds that mature on November 1, 2047. The bonds currently sell for 106 with a par value of 100. What is the yield to maturity on the PG 2047 bond? What is the Current Yield?The Capital Gains Yield?

The PG 2047 bond was issued with a call provision that cannot be used the first fiveyears.If the bond is called on its first allowable date ofon November1, 2022, the companywill pay bondholders 102.5. What is the yield to call on the PG 2047 bond?

Kimberly-Clark Corp. (KMB) has a 5% 2047 bond issue with a YTM of 6.0%. The PGand KMB bonds are identical in every way, including the Moody's and S&P ratings,maturity date, and the fact that the respective companies can call them on November 1,2022 for 102.5.(The bonds were issued on different dates, thus their coupon rates, currentmarket prices, and YTMs are the only difference.) What is the price for the 2047 KMB bond?

Explain the difference in the YTM for the 2047 PG and KMB bonds.Which bond provides the more accurate estimateof the rate required in the marketplace for PG at this time?(Hint: the bonds are of similar risk and should have a similar rate? However, they do not.Why is that?)