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Corson books just sold a Callable bond ($5000) par value. Its a 30 year semi-annual bond with a coupon rate of 6%. The bond starts
Corson books just sold a Callable bond ($5000) par value. Its a 30 year semi-annual bond with a coupon rate of 6%. The bond starts at the end of 10 years. IF the yield to call on the bond is 8% and the call requires ABC to pay 1 year of additional interest at the call ( or 2 coupon payments). What is the bond price if placed with the assumption that the call will be on the first available call date?
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