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LXR Co's 15-year bonds currently sell for $1,105 and have a par value of $1,000. The coupon rate is 9.36% and interest payments are made semi-annually. The bonds can be called 5 years after issue at a premium of 4% over par value. What is their yield to call (YTC), 2 years after the initial issue? 8.2654% 7.4788% 6.8448 % 5.5146% 6.6670%

LXR Co's 15-year bonds currently sell for $1,105 and have a par value of $1,000. The coupon rate is 9.36% and interest payments are made semi-annually. The bonds can be called 5 years after issue at a premium of 4% over par value. What is their yield to call (YTC), 2 years after the initial issue? 8.2654% 7.4788% 6.8448 % 5.5146% 6.6670%

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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LXR Co's 15-year bonds currently sell for $1,105 and have a par value of $1,000. The coupon rate is 9.36% and interest payments are made semi-annually. The bonds can be called 5 years after issue at a premium of 4% over par value. What is their yield to call (YTC), 2 years after the initial issue? 8.2654% 7.4788% 6.8448 % 5.5146% 6.6670%
Transcribed Image Text:LXR Co's 15-year bonds currently sell for $1,105 and have a par value of $1,000. The coupon rate is 9.36% and interest payments are made semi-annually. The bonds can be called 5 years after issue at a premium of 4% over par value. What is their yield to call (YTC), 2 years after the initial issue? 8.2654% 7.4788% 6.8448 % 5.5146% 6.6670%
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