Question: QUESTION 1 IBM has just issued a callable (at par) 12 year, 19% coupon bond with annual coupon payments. The bond can be called at

QUESTION 1

"IBM has just issued a callable (at par) 12 year, 19% coupon bond with annual coupon payments. The bond can be called at par in one year or anytime thereafter on a coupon payment date. It has a price of $108 per $100 face value. What is the bond's yield to call? Express your answers in strictly numerical terms. For example, if the answer is 5%, write 0.05."

10 points

QUESTION 2

"Apple has just issued a callable (at par) 10 year, 5% coupon bond with annual coupon payments. The bond can be called at par in one year or anytime thereafter on a coupon payment date. It has a price of $73 per $100 face value. What is the bond's yield to call? Express your answers in strictly numerical terms. For example, if the answer is 5%, write 0.05."

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