Four years ago, your firm issued $1,000 par, 25-year bonds, with a 9% coupon rate and...
Four years ago, your firm issued $1,000 par, 25-year bonds, with a 9% coupon rate and a 12% call premium. Assume semiannual compounding.
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If these bonds are now called, what is the actual yield to call for the investors who originally purchased them at par? Do not round intermediate calculations. Round your answer to two decimal places.
____% annually
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If the current interest rate on the bond is 6% and the bonds were not callable, at what price would each bond sell? Do not round intermediate calculations. Round your answer to the nearest cent.
$ ____
Homework Answers
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Four years ago, your firm issued $1,000 par, 25-year bonds, with
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Seven
years ago the Templeton Company issued 18-year bonds with an 11%
annual coupon rate at their $1,000 par value. The bonds had a 6%
call premium, with 5 years of call protection. Today Templeton
called the bonds. Compute the realized rate of return for an
investor who purchased the bonds when they were issued and held
them until they were called.
Seven years ago the Templeton Company issued 18-year bonds with an 11% annual coupon rate at their $1,000...
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