Question

Purple whale Energy has 9% annual coupon bonds that are callable and have 18 years left until maturity. The bonds have a par value of $1,000, and their current market price is $1,190.35. However, Purple Whale may call the bonds in eight yearsYTM at a call price of $1,060. What are the YTM and the yield to call (YTC) on Purple Whales bonds? YTC The current yield on the bond is If interest rates are expected to remain constant, what is the best estimate of the remaining life left for Purple Whales bonds? 10 years O 13 years O 18 years 8 years If Purple Whale Energy issued new bonds today, what coupon rate must the bonds have to be issued at par? О 9.59% О 6.47% О 7.09% О 8.82%

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