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A Bond Is Callable in 2 Years and Currently Has

Question 66

Multiple Choice

A bond is callable in 2 years and currently has a yield to call of 4.8 percent. The bond has a coupon rate of 5 percent and pays interest semi-annually. The call premium is $50 and the face value is $1,000. What is the current price?


A) $904.16
B) $989.14
C) $998.12
D) $1,003.77
E) $1,049.25

Correct Answer:

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