Compute the band yield to maturity

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Question - Bond valuation relationships - The 15-year, $1,000 par value bonds of Waco Industries pay 8 percent interest annually. The market price of the bond is $855, and the market's required yield to maturity on a comparable-risk bond is 11 percent.

a. Compute the band's yield to maturity.

b. Determine the value of the bond to you given the market's required yield to maturity on a comparable-risk bond.

c. Should you purchase the bond?

Reference no: EM133101221

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