Please answer with formula and work 5. A Bond is currently sold at $980, it has...

Question

Question

5. A Bond is currently sold at $980, it has 20 years to maturity and 9% coupon rate. The bond will be called in 5 years, the

Please answer with formula and work

Answer 1

Answer #1

Yield to call = (Coupon+(Callable value-Market price)/n) / ((Callable value+Market price)/2)
Yield to call = (90+(1050-980)/5) / ((1050+980)/2)	10.25%

Answer 2

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