Question
Zoro corporation also has some bonds for sale that your company is considering. These bonds have a thousand par value and will mature in 16
Zoro corporation also has some bonds for sale that your company is considering. These bonds have a thousand par value and will mature in 16 years. The coupon rate on the bonds is 5% paid annually and they are currently selling for $987 each the bonds are called protected and for the next four years after this period they are callable at 105 .on the basis of this information answered the following questions. What is the YTM on these bonds? If the bonds are called immediately after the call protection period, what would be the yield to call(YTC)? If the bonds paid interest semiannually instead of annually, would the YTC, the YTM or both change? Explain your answers.
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