Kholdy incs bonds currently sell for x per bond the


Kholdy Inc's bonds currently sell for $X per bond. The bond’s annual coupon payments are based on the coupon rate of 12%, and it has maturity of 20 years. Its call protection period is 5 years. You are also given that the bond’s yield to maturity (YTM) is 12% and yield to call (YTC) is 12.50%. What is the call premium amount? Assume that the face value of the bond is $1,000.

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Financial Management: Kholdy incs bonds currently sell for x per bond the
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