Suppose a 14 year 5% semiannual coupon bond with
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Suppose a 14 year 5% semiannual coupon bond with
Suppose a 14 year, 5%, semiannual coupon bond with a par value of $1000 is currently selling for $950. The bond can be called in another 3 years for $1075. Whould you be more likely to earn the yield to call or the yield to maturity?
| Yield to call because the current price is below the call price. | ||
| Yield to call because the coupon rate is above the yield to maturity. | ||
| Yield to maturity because the current price is below the call price. | ||
| Yield to maturity because the coupon rate exceeds the current market required return. |
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Suppose a 14 year 5% semiannual coupon bond with
Suppose a 14 year 5% semiannual coupon bond with
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