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Problem 1 : You are considering investing in a 10-year bond issued by NewEnergy Inc. This bond has $1000 face value, 4% coupon rate. The
| Problem 1: | You are considering investing in a 10-year bond issued by NewEnergy Inc. This bond has $1000 face value, 4% coupon rate. | |||||||||
| The bond pays coupons semi-annually and is currently selling at $920. The bond can be called at a $1,040 in 3 years. | ||||||||||
| 1.d. (6 points) | If the bond is called back by the firm at price of $1,040 in three years, what is the yield to call? | |||||||
| N= | ||||||||
| FV= | ||||||||
| PMT= | ||||||||
| PV= | ||||||||
| PMT Type= | ||||||||
| Periodic Discount Rate= | ||||||||
| Yield to Call = | ||||||||
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