A 4.75 percent coupon municipal bond has 20 years left to maturity and has a price quote
Question:
A 4.75 percent coupon municipal bond has 20 years left to maturity and has a price quote of 101.30. The bond can be called in eight years. The call premium is one year of coupon payments. (Assume interest payments are semiannual and a par value of $5,000.)
Compute the bond's current yield.(Do not round intermediate calculations. Round your answer to 2 decimal places.)
Compute the yield to maturity.(Do not round intermediate calculations. Round your answer to 2 decimal places.)
Compute the taxable equivalent yield (for an investor in the 36 percent marginal tax bracket).(Do not round intermediate calculations. Round your answer to 2 decimal places.)
Compute the yield to call.(Do not round intermediate calculations. Round your answer to 2 decimal places.)
Finance Applications and Theory
ISBN: 978-0077861681
3rd edition
Authors: Marcia Cornett, Troy Adair