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What is the actual yield to call for the investors

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Question - Four years ago, your firm issued $1,000 par, 25-year bonds, with a 7 percent coupon rate and a 10 percent call premium.

a. If these bonds are now called, what is the actual yield to call for the investors who originally purchased them at par?

b. If the current interest rate on the bond is 5 percent and the bonds were not callable, at what price would each bond sell?

Reference no: EM132756973

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