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Suppose you purchase a 15-year, 10% annual coupon, $1,000 par value bond, but the bond originally could be called after 10 years at a call
Suppose you purchase a 15-year, 10% annual coupon, $1,000 par value bond, but the bond originally could be called after 10 years at a call price of $1,100. One a year later, interest rates have fallen from 10% to 5% causing the value of the bond to rise to $1,493.93. What is the bonds YTC?
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