Question: Build a Model A 20-year, 8% coupon bond with a par value of $1,000 may be called in 5 years at a call price of

Build a Model A 20-year, 8% coupon bond with a par

Build a Model A 20-year, 8% coupon bond with a par value of $1,000 may be called in 5 years at a call price of $1,040. The bond sells for $1,100. 20 8% $1,000 Basic Input Data: Years to maturity: Coupon rate: Par value: Interest payment: Current price Call price: Years till callable: Periods till callable: $1,100 $1,040 5 a. What is the bond's yield to maturity? Peridodic YTM = b. What is the bond's current yield? Current yield = c. What is the bond's capital gain or loss yield? Cap. Gain/loss yield Note that this is an economic loss, not a loss for tax purposes. d. What is the bond's yield to call? Peridodic YTC =

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