Algo Co's 17-year bonds currently sell for $1,204 and have a par value of $1,000. The annual coupon rate is 8.55% and interest payments are made semi-annually. The bonds can be called 7 years after issue at a premium of 3.75% over par value. What is their yield to call (YTC), 1 year after the initial issue?
Algo Co's 17-year bonds currently sell for $1,204 and have a par value of $1,000. The annual coupon rate is 8.55% and interest payments are made semi-annually. The bonds can be called 7 years after issue at a premium of 3.75% over par value. What is their yield to call (YTC), 1 year after the initial issue?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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