Question
IBM has just issued a callable (at par) 5 year, 8% coupon bond with annual coupon payments. The bond can be called at par in
IBM has just issued a callable (at par) 5 year, 8% coupon bond with annual coupon payments. The bond can be called at par in one year or anytime thereafter on a coupon payment date. It has a price of $103 per $100 face value, implying a yield to maturity of 7.26%.
What is the bond's yield to call?
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Financial Modeling
Authors: Simon Benninga, Tal Mofkadi
5th Edition
0262046423, 9780253337825
