A 30 year maturity 8 coupon bond paying coupons


A 30 year maturity, 8% coupon bond paying coupons semiannually is callable in five years at a price of $1100. The bond currently sells at a yield to maturity of 7% (3.5% per half year)

a. What is the yield to call?

b. What is the yield to call of the call price is $1100 but the bond can be called in two years instead of 5?

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Financial Management: A 30 year maturity 8 coupon bond paying coupons
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