What is the bond's yield to maturity and yield to call?

Business & Finance
Tutor: None Selected Time limit: 1 Day

Three years ago, Jack's Automotive Jacks issued a 20-year callable bond with a $1000 maturity value and a 8.5 percent coupon rate of interest.  Interest is paid semiannually.  The bond is currently selling for $1046.

A) What is the bond's yield to maturity?

B) If the bond can be called in four years for a redemption price of $1085, what is the bond's yield to call?  

Apr 2nd, 2015

A

Market price $1,046.00
Par value $1,000.00
Interest 8.50%
Frequency 2
N(Years) 17
YTM 8.00%
B

Market price $1,046.00
Par value $1,000.00
Redemption at call $1,085.00
Interest 8.50%
Frequency 2
N(Years) 4
Yield to call 8.92%

Apr 2nd, 2015

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Apr 2nd, 2015
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Apr 2nd, 2015
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