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QUESTION 11 Assume a hypothetical 30-year bond is issued on 01 February 2021 at a price of 97.195 (as a percentage of par), Each bond
QUESTION 11
Assume a hypothetical 30-year bond is issued on 01 February 2021 at a price of 97.195 (as a percentage of par), Each bond has a par value of 1,000, The bond is collable
"in whole or in part" every 01 February from 2031 at the option of the issuer. The call prices are shown below.
Assume a hypothetical 30-year bond is issued on 01 February 2021 at a price of 97.195 (as a percentage of par), Each bond has a par value of 11.250, Th
Year
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
Call price
103.870
103.485
103.000
102.709
102.322
101 955
101.548
101 161
101.774
100.387
100.000
Answer the following questions:
A. What is the call period for this bond?
B. What is the call premium (per $1,000 in par value) in 2033?
C. What this type of callable bond is: American, European or Bermuda, and why?
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