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XZYY, Inc. currently has an issue of bonds outstanding that will mature in 34 years. The bonds have a face value of $1,000 and a stated annual coupon rate of 18% with annual coupon payments. The bond is currently selling for $1114. The bonds may be called in 4 years for 121% of par value. What is your expected quoted annual rate of return if you buy the bonds and the company calls them when possible? 17.81% 16.15% 19.58% 14.79% 12.11%

XZYY, Inc. currently has an issue of bonds outstanding that will mature in 34 years. The bonds have a face value of $1,000 and a stated annual coupon rate of 18% with annual coupon payments. The bond is currently selling for $1114. The bonds may be called in 4 years for 121% of par value. What is your expected quoted annual rate of return if you buy the bonds and the company calls them when possible? 17.81% 16.15% 19.58% 14.79% 12.11%

Principles of Accounting Volume 1
Principles of Accounting Volume 1
19th Edition
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax
Chapter13: Long-term Liabilities
Section: Chapter Questions
Problem 2EB: Waylan Sisters Inc. issued 3-year bonds with a par value of $100,000 and a 6% annual coupon when the...
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XZYY, Inc. currently has an issue of bonds outstanding that will mature in 34 years. The bonds have a face value of $1,000 and a stated annual coupon rate of 18% with annual coupon payments. The bond is currently selling for $1114. The bonds may be called in 4 years for 121% of par value. What is your expected quoted annual rate of return if you buy the bonds and the company calls them when possible? 17.81% 16.15% 19.58% 14.79% 12.11%
Transcribed Image Text:XZYY, Inc. currently has an issue of bonds outstanding that will mature in 34 years. The bonds have a face value of $1,000 and a stated annual coupon rate of 18% with annual coupon payments. The bond is currently selling for $1114. The bonds may be called in 4 years for 121% of par value. What is your expected quoted annual rate of return if you buy the bonds and the company calls them when possible? 17.81% 16.15% 19.58% 14.79% 12.11%
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