Suppose a company issued 30-year bonds some time ago when market interest rates were quite high. The coupon rate on those bonds will have been fixed at the higher rates. And since at the time financial managers knew the market rates might change before the 30 years to retire the bonds. They almost certainly made sure??
A. that bonds's YTM was able to be lowered in order to reduce the semi-annual payments.
B. that bonds were able to be called early.
C.that the bonds would default to junk status.
They almost certainly made sure that bonds were able to be called early and issue new bonds at lower rates
Suppose a company issued 30-year bonds some time ago when market interest rates were quite high. The coupon rate on thos...
YIELD TO CALL f call Nine years ago the Templeton Company issued 30-year bonds with an 12% annual coupon rate at their $$1,000 par value. The bonds had an 8% call premium, with 5 years protection. Today Templeton called the bonds a. Compute the realized rate of return for an investor who purchased the bonds when they were issued and held them until they were called. Round your answer to two decimal places. b. Why the investor should or should...
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...
Nine years ago the Templeton Company issued 29-year bonds with an 11% annual coupon rate at their $1,000 par value. The bonds had a 9% 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. Round your answer to two decimal places. % Why the investor should or should not be happy that...
Nine years ago the Templeton Company issued 22-year bonds with an 12% annual coupon rate at their $1,000 par value. The bonds had an 8% 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. Round your answer to two decimal places. % Why the investor should or should not be happy that...
Six years ago the Templeton Company issued 17-year bonds with an 15% annual coupon rate at their $1,000 par value. The bonds had an 9% call premium, with 5 years of call protection. Today Templeton called the bonds. A. Compute the realized rate of return for an investor who purchased the bonds when they were issued and held them until they were called. Round your answer to two decimal places. _______% B. Why the investor should or should not be...
Six years ago the Templeton Company issued 20-year bonds with a 13% annual coupon rate at their $1,000 par value. The bonds had an 8% 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. Round your answer to two decimal places. % Why should or should not the investor be happy that...
7.8 Ten years ago the Templeton Company issued 25-year bonds with a 9% 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. Round your answer to two decimal places. % Why should or should not the investor be happy...
Seven years ago the Templeton Company issued 30-year bonds with an 11% annual coupon rate at their $1,000 par value. The bonds had an 5% 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. Round your answer to two decimal places. %
Ten years ago the Templeton Company issued 26-year bonds with a 9% 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. Round your answer to two decimal places. % Why the investor should or should not be happy that...
YIELD TO CALL-6 Seven years ago the Templeton Company issued 29-year bonds with an 11% annual coupon rate at their $1,000 par value. The bonds had an 5% 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. Round your answer to two decimal places. %? Why the investor should or should not...