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General Electric has just issued a callable (at par) ten-year 8% coupon bond with annual coupon payments. The bond can be called at par in one year or anytime thereafter on a coupon payment date. It has a price of $104 and a face value of $104.

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

The yield to maturity is.................... %. (Round to two decimal places.)

b) What is the bond's yield to call?

The yield to call is...................... %. (Round to two decimal places.)

Financial Management, Finance

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