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Please show all calculations, thank you a lot! Suppose that one bond has a price of $100 and is not callable. A second bond is
Please show all calculations, thank you a lot!
Suppose that one bond has a price of $100 and is not callable. A second bond is equivalent in every way - credit risk, coupon, maturity, et cetera - except that it is callable at a price of $110 - a price well above the current price of the otherwise-equivalent non-callable bond. What can you say (with no additional information) about the price of the callable bondStep by Step Solution
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