What is the yield to call of this bond when it is released

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1) The average annual return over the period 1886-2006 for stocks that comprise the S&P 500 is 10%, and the standard deviation of returns is 20%. Based on these numbers, what is a 95% confidence interval for 2007 returns?

2) A company issues a callable (at par) five-year, 7% coupon bond with annual coupon payments. The bond can be called at par in one year after release or any time after that on a coupon payment date. On release, it has a price of $1,030 per $1,000 of face value. What is the yield to call (YTC) of this bond when it is released?

3) A company issues a callable (at par) ten-year, 7% coupon bond with annual coupon payments. The bond can be called at par in one year after release or any time after that on a coupon payment date. On release, it has a price of $1,060 per $1,000 of face value. What is the yield to worst of this bond when it is released?

Reference no: EM131859821

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