I 16. JR Industries has a bond outstanding with 30 years to maturity, an 6.0% nominal coupon, semiannual payments, and a $1,000 par value. The bond has a 5.50% nominal yield to maturity, but it can be called in 5 years at a price of $1,050. What is the bond's nominal yield to call (YTC)?

Brief Principles of Macroeconomics (MindTap Course List)
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Author:N. Gregory Mankiw
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Chapter9: The Basic Tools Of Finance
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16. JR Industries has a bond outstanding with 30 years to maturity, an 6.0%
nominal coupon, semiannual payments, and a $1,000 par value. The bond has a 5.50%
nominal yield to maturity, but it can be called in 5 years at a price of $1,050. What is
the bond's nominal yield to call (YTC)?
Transcribed Image Text:I 16. JR Industries has a bond outstanding with 30 years to maturity, an 6.0% nominal coupon, semiannual payments, and a $1,000 par value. The bond has a 5.50% nominal yield to maturity, but it can be called in 5 years at a price of $1,050. What is the bond's nominal yield to call (YTC)?
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