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Yield, Price, and YTM A corporate bond maturing in 22 years with a coupon rate of 7.2 percent was purchased for $1,100 and is now
Yield, Price, and YTM A corporate bond maturing in 22 years with a coupon rate of 7.2 percent was purchased for $1,100 and is now selling for $1,200. a. What is its current yield? Round your answer to one decimal place. % b. Calculate the bond's YTM using Equation 14.5 or the Garman/Forgue companion website. Round your answer to two decimal places % c. What will the bond's selling price and YTM be if comparable market interest rates rise 4.8 percent points in two years? (Hint: Use Appendix A-2 and Appendix A-4 or the Garman/Forgue companion website and Equation 14.5.) Round Present Value of a Single Amount and Present Value of a Series of Equal Amounts in intermediate calculations to four decimal places. Round the monetary value to the nearest cent and percentage value to two decimal places. Bond value: \$ YTM: B%
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