A semi-annual corporate bond selling for R915.16, with a coupon of 6% has a YTM of 8%. The bond matures in 10 years, but can be called in 8 years at a call price of R1080 (this is a premium of 8%). What is this bond's Yield to Call (YTC )? a.3.6% b.4.1% c.6.56% d.7.2% e.8.2%

A semi-annual corporate bond selling for R915.16, with a coupon of 6% has a YTM of 8%. The bond matures in 10 years, but can be called in 8 years at a call price of R1080 (this is a premium of 8%). What is this bond's Yield to Call (YTC )? a.3.6% b.4.1% c.6.56% d.7.2% e.8.2%

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter4: Bond Valuation

Section: Chapter Questions

Problem 8MC: Suppose a 10-year, 10% semiannual coupon bond with a par value of 1,000 is currently selling for...

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Question

A semi-annual corporate bond selling for R915.16, with a coupon of 6% has a YTM of 8%.
The bond matures in 10 years, but can be called in 8 years at a call price of R1080 (this is a premium of 8%).
What is this bond's Yield to Call (YTC )?

a.3.6%

b.4.1%

c.6.56%

d.7.2%

e.8.2%

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