Question: Problem 7 - 2 2 Yields of a Bond ( LG 7 - 6 ) A 2 . 6 0 percent coupon municipal bond has

Problem 7-22 Yields of a Bond (LG7-6)
A 2.60 percent coupon municipal bond has 10 years left to maturity and has a price quote of 95.25. The bond can be called in four years. The call premium is one year of coupon payments. (Assume interest payments are semiannual and it has a par value of $5,000.)
Compute the bond's current yield.
Compute the yield to maturity.
Compute the taxable equivalent yield (for an investor in the 30 percent marginal tax bracket).
Compute the yield to call.
Note: Do not round intermediate calculations. Round your answer to 2 decimal places.
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 Problem 7-22 Yields of a Bond (LG7-6) A 2.60 percent coupon

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