To find the YTC (yield to call), we need to put the following values in the financial calculator:
INPUT | 13*2=26 | -91.8%*1000=-918 | (8.25%/2)*1000=41.75 | 1000+120=1120 | |
TVM | N | I/Y | PV | PMT | FV |
OUTPUT | 4.93 |
So, periodic rate = 4.93%
YTC = Periodic Rate * No. of periods in a year
= 4.93% * 2 = 9.86%
Hence, option "A" is correct.
17. Tyson, Inc. issued a 20-year bond which is callable in 13 years. It has a...
Two years ago, Synergy Inc. issued a 15-year callable bond with a $1,000 face value and a 12 percent coupon rate of interest (paid semiannually). The bond cannot be called until five years after issue, at which time the call price will equal $1,120. Currently, the bond is selling for $989.What is the bond's yield to call (YTC).
Tucker Corporation plans to issue new 20-year bonds that are callable after 5 years at a call premium of $1,050. Suppose this bond has a face value of $1,000 the price is currently $1,000. The coupon rate is 10% which is paid semiannually. Does the yield to maturity exceed the yield to call on this bond? a. Yes b. No c. Not enough information
BBC has just issued a callable (at par) 5 year, 4% coupon bond with quarterly coupon payments. The bond can be called at par in two years or anytime thereafter on a coupon payment date. It has a price of $108per $100 face value. What is the bond's yield to call?
IBM has just issued a callable (at par) 5 year, 7% coupon bond with quarterly coupon payments. The bond can be called at par in two years or anytime thereafter on a coupon payment date. It has a price of $102 per $100 face value. What is the bond's yield to call?
Six years ago, you purchased a callable bond with fifteen years until maturity. The bond has a $1,000 par value and pays interest semiannually. The bond has 9% coupon rate and a 6% yield to maturity. The bond offers three years of call protection and a 2% call premium. a. How much did you pay for the bond at the time of purchase? b. Today, the firm called the bond. What is the bond’s yield to call? c. Did the...
Bond A has a maturity of eight years, but is callable after three years. Bond A has a face value of $1000, a coupon rate of 4%, a yield to maturity of 4% (semiannual coupons) and a current price of $1,165. If the bond is called the bond owner will get $1,150. If bond A is called at three years, what is its yield to call stated as an APR? Group of answer choices 3.02% 1.51% 2.00% 3.24%
Rearden Metal has just issued a callable, $1000 par value, twenty-year, 8% coupon bond with semiannual coupon payments. The bond can be called at par in five years or anytime thereafter on a coupon payment date. If the bond is currently trading for $1040.79, then its yield to call is closest to: Group of answer choices 3.8% 7.0% 7.6% 8.0%
A callable bond has 15 years to maturity and can be called in 5 years. The bond’s coupon rate is 12% with semi-annual coupon payments. The par value is $1000. If the bond is called, the call price will be $1100. The bond is currently selling for $1055.35 What is the difference between its yield-to-call and yield-to-maturity?
General Electric has just issued a callable (at par) 10-year, 6.1 % coupon bond with annual coupon payments. The bond can be called at par in one year or anytime thereafter on a coupon payment date. It has a price of $ 101.64. a. What is the bond's yield to maturity? b. What is its yield to call? c. What is its yield to worst?
General Electric has just issued a callable (at par) 10-year, 6.5% coupon bond with annual coupon payments. The bond can be called at par in one year or anytime thereafter on a coupon payment date. It has a price of $101.77. a. What is the bond's yield to maturity? b. What is its yield to call? c. What is its yield to worst?