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Suppose that eight years ago a corporation issued a 1 5 - year bond with a coupon rate of 7 % and the indenture specifies

Suppose that eight years ago a corporation issued a 15-year bond with a
coupon rate of 7% and the indenture specifies a make-whole call
premium of 25 basis points over the yield on a comparable Treasury at
the time the call provision is exercised. Assume that the call is exercised
immediately after the payment of a coupon. At the time the issue is
called, the yield on a comparable Treasury is 3.15%. What is the makewhole call price per $100 of par value if the issue is called at the end of
the eighth year?

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