A corporate bond pays interest annually and has 3 years to maturity, a face value of $1,000 and a coupon rate of 3.8%. The bond's current price is $1,002.79. It is callable at a call price of $1,050 in one year.

A corporate bond pays interest annually and has 3 years to maturity, a face value of $1,000 and a coupon rate of 3.8%. The bond's current price is $1,002.79. It is callable at a call price of $1,050 in one year.

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter4: Bond Valuation

Section: Chapter Questions

Problem 10P

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Question

Problem 29
You have until 9:00 PM to complete this assignment.
Intro
A corporate bond pays interest annually and has 3 years to maturity, a face value of $1,000 and a coupon
rate of 3.8%. The bond's current price is $1,002.79. It is callable at a call price of $1,050 in one year.
Part 1
What is the bond's yield to maturity?
4+ decimals
Save
Part 2
What is the bond's yield to call?
3+ decimals
Save
Attempt 1/1
Attempt 1/1

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