A 7-year, 11.00% semiannual coupon bond with a par value of $1000 may be called in 5 years at a call price of $1,201.00. The bond sells for $985.50. (Assume that the bond has just been issued.). What is it’s yield to maturity? Round your answer to two decimal places. For example, if your answer is $345.6671 round as 345.67 and if your answer is .05718 or 5.7182% round as 5.72.   10.51% 8.59% 11.53% 11.31% 9.27%

Essentials Of Investments
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ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
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Chapter1: Investments: Background And Issues
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A 7-year, 11.00% semiannual coupon bond with a par value of $1000 may be called in 5 years at a call price of $1,201.00. The bond sells for $985.50. (Assume that the bond has just been issued.). What is it’s yield to maturity?

Round your answer to two decimal places. For example, if your answer is $345.6671 round as 345.67 and if your answer is .05718 or 5.7182% round as 5.72.

 

10.51%
8.59%
11.53%
11.31%
9.27%
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