Question: A retailer has just issued a note that carries a coupon of 5.875% (semi-annual), matures in 3 years and is priced at 88.5 (per 100

A retailer has just issued a note that carries a coupon of 5.875% (semi-annual), matures in 3 years and is priced at 88.5 (per 100 par).

a) Estimate the YTM and the effective annual yield of the note.

b) what information is provided to the management and the BOD of the retailer given the YTM of their debt?

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