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Ted Owns a Bond Which Is Callable in 2

Question 73

Multiple Choice

Ted owns a bond which is callable in 2.5 years.The bond has a 6 percent coupon,pays interest semiannually,has a par value of $1,000,and has a yield to call of 6.3 percent.What is the call premium if the bond currently sells for $1,044.54?


A) $50
B) $60
C) $70
D) $75
E) $80

Correct Answer:

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