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A 2.80 percent coupon municipal bond has 12 years left to maturity and has a price quote of 97.25. The bond can be called in four years. The call premium is one year of coupon payments. (Assume interest payments are semiannual and a par value of $5,000.)

Compute the bond’s current yield. (Round your answer to 2 decimal places.)

  Current yield %  

Compute the yield to maturity. (Round your answer to 2 decimal places.)

  Yield to maturity %  

Compute the taxable equivalent yield (for an investor in the 30 percent marginal tax bracket). (Round your answer to 2 decimal places.)

  Equivalent taxable yield %

Compute the yield to call. (Round your answer to 2 decimal places.)

  Yield to call %

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M92740174

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