Maturity Rating Fetures Bond A 10 years AA Put Provision Bond B 10 years A Call...
| Maturity | Rating | Fetures | |
| Bond A | 10 years | AA | Put Provision |
| Bond B | 10 years | A | Call Provision |
Appraise which bond has the higher yield to maturity.
Homework Answers
As both bonds have same maturity, we compare rating.
So, we will compare based on rating and features
Based on rating: As Bond B has lower rating, Bond B will have
higher yield
Based on features: As Bond B has call provision, Bond B will have
higher yield
As both have same result, so we can conclusively say that Bond B
has the higher yield to maturity
Add Answer to:
Maturity
Rating
Fetures
Bond A
10 years
AA
Put Provision
Bond B
10 years
A
Call...
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