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Solve with explanation 4. A company XYZ issued 30 year bonds with 10% annual coupon rate at their par value of $1000 in 2010. The

Solve with explanation

4. A company XYZ issued 30 year bonds with 10% annual coupon rate at their par value of $1000 in 2010. The Bonds had a 7% call premium, with 5 years of call protection. Today XYZ called the bonds. Compute the realized rate of return for an investor who purchased the bonds when they were issued in 2010. Briefly explain why the investor should or should not be happy.

5. ABC Corporation outstanding bonds have a par value of $1000, 8% coupon and 15 years to maturity and a 10% YTM. What is the bond's price?

6. What does a call provision (call feature) allow (bond) issuers to od and under what circumstances would they do it?

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