QuizWhat Bonds and Their Valuation A 12-year bond with a 10 percent semiannual coupon and a $1,000 par value has a nominal yield to maturity of 9 percent. The bond can be called in five years at a call price of $1,050. What is the bond’s nominal yield to call?

A 12-year bond with a 10 percent semiannual coupon and a $1,000 par value has a nominal yield to maturity of 9 percent. The bond can be called in five years at a call price of $1,050. What is the bond’s nominal yield to call?

Bonds and Their Valuation

A 12-year bond with a 10 percent semiannual coupon and a $1,000 par value has a nominal yield to maturity of 9 percent. The bond can be called in five years at a call price of $1,050. What is the bond’s nominal yield to call?

a. 4.50%
b. 8.25%
c. 8.88%
d. 8.98%
e. 9.00%

Answer: D

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QuizWhat

A 12-year bond with a 10 percent semiannual coupon and a $1,000 par value has a nominal yield to maturity of 9 percent. The bond can be called in five years at a call price of $1,050. What is the bond’s nominal yield to call?

A 12-year bond with a 10 percent semiannual coupon and a $1,000 par value has a nominal yield to maturity of 9 percent. The bond can be called in five years at a call price of $1,050. What is the bond’s nominal yield to call?

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